Title
Public Hearing to Consider an Appeal of the Planning Board’s Decision to Approve Use Permit No. PLN20-0160 to Allow the Operation of a Cannabis Retail Dispensary at 2416 Lincoln Avenue; and
Adoption of Resolution Denying Appeal and Approving Use Permit Application No. Pln20-0160, Subject to Modified Conditions of Approval, to Allow the Operation of a Cannabis Retail Dispensary at 2416 Lincoln Avenue. (Planning, Building and Transportation 481005)
Body
To: Honorable Mayor and Members of the City Council
EXECUTIVE SUMMARY
On August 17, 2020, the Planning Board approved a Use Permit application to allow the operation of a cannabis retail dispensary at 2416 Lincoln Avenue (Exhibit 1, Planning Board Resolution No. PB-20-19). On August 27, 2020, Enrico Meier (Appellant) filed a timely appeal (Appeal) of the Planning Board’s decision (Exhibit 2, Appeal).
Staff recommends that the City Council deny the Appeal and approve the Use Permit, thereby upholding the Planning Board’s decision, subject to modified conditions of approval to limit the storefront hours of operation to a 9pm closing time in accordance with Alameda Municipal Code (AMC) Section 6-59.10.o (Hours of Operation).
BACKGROUND
In 2017, the City Council adopted two separate ordinances which permitted commercial cannabis activity within the City of Alameda (City). The first ordinance codified AMC Section 6-59, which established regulations for commercial cannabis activity in the City (Cannabis Business Regulations). The Cannabis Business Regulations require that every commercial cannabis business obtain a Cannabis Business Operator’s Permit (Operator’s Permit) and capped the number of cannabis retail dispensaries to two in the City. The second ordinance modified the Zoning Ordinance (AMC Section 30-10) to allow commercial cannabis activity in certain zoning districts, and required all commercial cannabis businesses obtain a use permit. In terms of sequence, each cannabis retail dispensary must first obtain a use permit, followed by an Operator’s Permit.
In March 2019, the Planning Board approved the first use permit for a retail cannabis dispensary at 1528 Webster Street, which began operations in February of 2020.
In May 2019, the City Council adopted an ordinance that increased the maximum number of cannabis dispensaries in the City from two to four, with no more than two dispensaries allowed on either side of Grand Street. During the City Council’s public deliberations, both Park Street and Webster Street commercial corridors were specifically identified by the City Council as appropriate locations for dispensaries in Alameda. With one dispensary already approved on Webster Street, the City then issued a Request for Proposals (RFP) for the remaining three cannabis retail dispensary spots.
In December 2019, the applicant was one of the three RFP respondents to be awarded the privilege to seek approval for its proposed dispensary at 2416 Lincoln Avenue. The two other RFP respondents obtained Planning Board approval of their use permit applications on June 22, 2020.
On August 17, 2020, the Planning Board conducted a duly noticed public hearing on the Use Permit application and considered the entirety of the record, including all submitted materials and public comments regarding the Use Permit application. Upon conclusion of the public hearing, the Planning Board unanimously approved the Use Permit application. The Planning Board did not take action on the Design Review component of the project as they determined the plans for the changes to the exterior of the building required additional work. The applicant subsequently resubmitted drawings in response to direction made by the Planning Board, and as of the writing of this report, the Planning Board is scheduled to review the Design Review revisions at its October 12, 2020 regular meeting.
On August 27, 2020, Appellant filed the Appeal of the Planning Board’s decision to approve the use of the site for a cannabis dispensary.
If the City Council approves the Use Permit and upholds the Planning Board’s decision, this use permit will be for the second of two retail dispensaries near Park Street, the first being the cannabis retail dispensary approved at 1222 Park Street. An approval will also mean that the City has reached the maximum number of four cannabis retail dispensaries allowed in Alameda under the Cannabis Business Regulations. The City will not consider any additional applications unless one of the existing or previously approved cannabis retail dispensaries forfeits their Operator’s Permit or the City permanently revokes one of the Operator’s Permits. If the Council does not uphold the Planning Board’s approval, the applicant will not be able to proceed to obtaining an Operator’s Permit and the City may consider additional applications to fill the fourth and final spot for a cannabis retail dispensary.
DISCUSSION
Standard of Review
This Appeal is governed by AMC Section 30-25 (Appeals or Calls for Review). AMC Section 30-25.1 provides that any decision of the Planning Board may be appealed to the City Council by any person aggrieved or affected by the decision. AMC Section 30-25.5 (Procedures for Appeals and Calls for Review) provides that a hearing date for the appeal must be scheduled for public hearing and decision by the City Council no later than the third regularly scheduled and held meeting following submittal of the appeal. The October 20, 2020 public hearing date meets this timing requirement.
AMC Section 30-25.5 also provides that the City Council reviews the Planning Board’s decision de novo. The “City Council may consider the introduction of all pertinent material, including all documents constituting the administrative record.” Id. “At the hearing, any party or person may appear in person or by agent or attorney to provide testimony.” Id. The City Council may reverse or affirm, in whole or in part, or may modify the decision of the Planning Board. Id.
Permitting Process for a Cannabis Retail Dispensaries in Alameda
The AMC requires commercial cannabis businesses to obtain both a Use Permit and an Operator’s Permit to lawfully operate within the City. The use permit, at issue for this appeal, is a discretionary land use permit, where the Planning Board may establish conditions of approval with respect to maintenance and operation of the cannabis business to ensure that the project meets the purposes of the Zoning Ordinance and AMC Section 6-59.1 et seq.
After receiving approval of a use permit, the applicant must also obtain an Operator’s Permit (not at issue for this appeal), which is a ministerial permit issued at a staff level and primarily reviewed by the Alameda Police Department. Pursuant to AMC Section 6-59.4(a), the Operator’s Permit is a conditional privilege to conduct activities set forth in the permit. The Operator’s Permit is not transferrable, and unlike a use permit, does not run with the land. Staff may revoke the Operator’s Permit if it is determined that the operator has violated any of the standards and conditions specified in AMC Section 6-59, including the following:
1. Compliance with all applicable law, i.e., state and local requirements, including conditions of approval established by the Planning Board;
2. Compliance with operational radius requirements;
3. Systems for air quality, odor control, and ventilation;
4. Security Measures (including a security guard); and
5. Provision of Alarm Systems.
In addition to a use permit and Operator’s Permit, the project must meet other local requirements, including issuance of building permits for the site and building improvements, business license, labor peace agreement or declaration, etc. Finally, the applicant must also obtain and maintain in good standing a “Type-10 (Dispensary; General)” license from the State Bureau of Cannabis Control (BCC) prior to beginning operations.
Decision at Issue - Use Permit Approval
The City’s Use Permit process for commercial cannabis businesses is described in AMC Section 30-10.1(f). The application, like all use permit applications, must also be consistent with standard use permit regulations in AMC Sections 30-21.3 and 30-21.4.
The application was heard by the Planning Board at a duly noticed Special Meeting on August 17, 2020. In approving the Use Permit, the Planning Board found the proposal to be compatible with the adjacent land uses, adequately serviced by transportation services and facilities, will not negatively impact the business community, and is consistent with the General Plan. The Planning Board resolution of approval includes the following findings, as required by AMC Section 30-21.3(b):
1. “The location of the proposed use is compatible with other land uses in the general neighborhood area, and the project design and size is architecturally, aesthetically, and operationally harmonious with the community and surrounding development.
The location of the proposed use is compatible with other land uses in the general neighborhood area, and the proposed operations are harmonious with the community and surrounding development. The proposed land use is a retail use, similar to a pharmacy. Customers visit the business to purchase a product or conduct business. The Cannabis Retail dispensary operations will be conducted entirely within the existing building. Exterior alterations and site improvements will reduce the size of the building, and the project will be operationally harmonious to the surrounding commercial district properties. The proposed work requires Design Review approval, but any changes to the exterior of the building will be finished with materials matching the existing main structure. Both the City’s Cannabis Business Ordinance (AMC Section 6-59.1 et seq.) and conditions of approval of this permit require the applicant to provide a security plan for review and approval by the Chief of Police, which includes a full-time private security guard to maintain existing conditions in the public right of way adjacent to the business.
2. The proposed use will be served by adequate transportation and service facilities including pedestrian, bicycle, and transit facilities.
The project will improve the currently unpaved rear of the property to provide five new off-street parking spaces for the business. Additionally, the project site is located within the Park Street commercial district, which is fully developed and does not require additional transportation or service facilities on-site. The site is served by AC Transit bus routes 20, 51A, 96, and O, which all have stops within a quarter mile walking distance. The project conditions of approval require installation of two bicycle racks to increase availability in the Park Street business district and membership with the Alameda Transportation Management to provide all full-time and part-time employees with one AC Transit EasyPass. Therefore, the proposed use will be served by adequate transportation and service facilities, including pedestrian, bicycle, and transit facilities, in addition to newly constructed off-street parking.
3. The proposed use, if it complies with all conditions upon which approval is made contingent, will not adversely affect other property in the vicinity and will not have substantial deleterious effects on existing business districts or the local economy.
The proposed use with all conditions will not adversely affect property in the vicinity and will not have substantial deleterious effects on existing business districts or the local economy. The project, through the conditions of approval of this use permit and the Cannabis Business Operator’s Permit, will implement a series of Good Neighbor Policies and a security plan to address any potential impacts or nuisances to the surrounding neighborhood. These policies address potential outdoor nuisances including safe exterior lighting; odor control; on-site noticing for patrons to deter smoking, cannabis consumption in public spaces, and littering; and at least one security guard to enforce these policies. Inside the building, the applicant is also required to install odor control, filtration, and ventilation system(s) to control odors, humidity, and mold so that odor generated inside the property is not detected outside the property. Violations of the conditions herein or of the general conditions in AMC Section 6-59.10 are grounds for the City to take enforcement action, including the issuance of administrative citations, and to revoke or modify this use permit.
4. The proposed use relates favorably to the General Plan.
The project relates favorably to General Plan Policy 2.5.a, which calls for providing enough retail business and services to provide Alameda residents with a full range of services. The project conditions of approval require funding for two new bicycle racks and membership with the Alameda Transportation Management Association, which relates favorably to Implementing Policy 2.5.s, which calls for improving public transit service and transit facilities in retail areas. The funding for bicycle racks will provide new transit facilities within the Park Street business district and membership in the Alameda Transportation Management Association will result in the distribution of an ACTransit EasyPass to each employee and increase demand for public transit in the Webster Street business district.”
Basis of Appeal
The following section summarizes the Appellant’s arguments and the staff response.
Appellant Argument #1 - Insufficient Transportation Facilities. Through a series of related arguments about parking, the Appellant claims that the Planning Board erred in making the required finding #2 that “the proposed use will be served by adequate transportation and service facilities including pedestrian, bicycle, and transit facilities”. Specifically, the Appeal focuses on the off-street parking requirements of the City’s Parking Ordinance (AMC Section 30-7). The Appeal makes the following claims:
A. Appellant claims that AMC Section 30-7.1 imposes objective conditions for off-street parking that the project does not meet. Appellant claims that AMC Section 30-7.6, Schedule for Off-Street Parking, requires seven (7) off-street parking spaces; because the project only provides five (5) off-street parking spaces, the project does not comply with the AMC.
Staff response: AMC Section 30-7.1 contains statements of intent that establish the City’s authority to regulate off-street parking. Section 30-7.2 states that when considering a conditional use permit for an existing building, the “Planning Board may require that additional newly created parking be provided on- or off-site or that measures be imposed to reduce parking demand in accordance with subsection 30-7.13 <https://library.municode.com/ca/alameda/codes/code_of_ordinances?nodeId=CHXXXDERE_ARTIZODIRE_30-7OREPALOSPRE_30-7.13REPARE>.” (Emphasis added.) AMC Section 30-7 does not require that when conditional use permits are issued for use of existing buildings, the City must require the applicant to construct all the parking required by Section 30-7 for new buildings. Rather, the Code gives the Planning Board discretion to consider the parking conditions when considering a Use Permit application and determine whether to require the new occupant of the building to construct all of the parking required for that building under the AMC.
In this case, the project increases the amount of available parking on site from the existing two (2) usable carport spaces (the carport is proposed to be demolished) to five (5) surface parking spaces, for a net increase of three (3) on-site parking spaces. The existing property has a dilapidated, unusable five (5) car garage that does not meet current parking standards and a two (2) car usable carport, both of which are proposed to be demolished and replaced with 5 surface parking spaces. Therefore, the project would increase the amount of parking from two (2) spaces to five (5) spaces. Under AMC 30-7.4, when the number of existing off-street parking spaces is less than required, new spaces may be added even if the sum of existing parking plus proposed parking is less the total required amount.
The AMC parking provisions recognize that the need for parking must be balanced with the need to preserve the Park Street Historic District. Most buildings in the Historic District were developed without off-street parking and to require construction of off-street parking with each use permit would require removal and/or major modifications to existing historic structures. The City’s long established practice for Park Street businesses is not to require building more parking, but rather implement strategies to reduce parking demand and encourage a pedestrian-oriented business environment as directed by the General Plan. These strategies include requiring membership in the Alameda Transportation Management Association (ATMA), mandatory free transit passes for employees, and installing bicycle racks throughout the business district. In this case, the Planning Board required additional parking to the extent feasible, imposition of TDM measures, and additional bicycle parking.
B. Appellant claims that the project is required to comply with AMC Section 30-4.22.d, special parking requirements for the Theatre Combining District.
Staff response: AMC Section 30-4.22.d, including the requirement to conduct a peak parking demand study, only applies to Use Permits for uses listed in AMC Section 30-4.22.c (i.e., multiplex, performance theaters, etc.). The requirements in Section 30-4.22.d do not apply to commercial cannabis businesses, therefore, the applicant was not required to submit a peak parking demand study.
C. Appellant claims its argument of insufficient parking demonstrates the project does not meet Use Permit findings #2 and #3. Specifically the Appeal claims that the project is not served by adequate transportation and service facilities, including pedestrian, bicycle, and transit facilities, and that the project will adversely affect other property in the vicinity.
Staff response: As stated in Resolution No. PB-20-19, the Planning Board was able to make all required Use Permit findings, including the determination that the project is served by adequate transportation and service facilities, as conditioned. Specifically, the Planning Board found that the project will be served by a combination of off-street parking, a business environment that is pedestrian-oriented, and walking distance to several bus lines serving not just the City but also the larger region.
D. Appellant claims that any retail use of the project site will have unspecified impacts on the neighborhood due to current illegal double parking on the 2400 block of Lincoln Avenue, and illegal speeding on nearby sections of Park Street and Lincoln Avenue.
Staff response: The Planning Board’s approval of the use permit requires all onsite parking be reserved for customers (Condition No. 8, Off-Street Parking), which together with other TDM measures described earlier will alleviate concerns about illegal parking. Otherwise, the Appellant’s claim is unjustified as it is basically an argument to keep the property vacant. It also unfairly speculates that cannabis retail customers will ignore traffic laws and illegally park or speed on Lincoln Avenue.
E. Appellant argues that the bike racks shown in the public right of way on the plans will block the sidewalk and create a public safety hazard.
Staff response: The Planning Board required the location of the public bicycle parking be reviewed by the City’s Transportation Coordinator (Condition No. 6, Bicycle Racks). Additionally, all bike racks installed in the public right of way require an encroachment permit, where the City Engineer will have an opportunity to review for compliance with minimum clearance requirements.
Appellant Argument #2 - Security. The Appellant argues that the Planning Board erred in making the third finding that the project “will not adversely affect other property in the vicinity”. The Appeal claims that the required security guard will only provide security within one hundred feet (100’) of the project site and this level of security is not sufficient to protect eight (8) children that live within two hundred feet (200’) of the project from unspecified crime generated by the project.
Staff Response. City Council adopted the City’s Cannabis Business Regulations with public safety in mind. The regulations require that the Alameda Police Department approve the project’s security plan as part of granting an Operator’s Permit. Per AMC Section 6-59.10.q, required security measures include a registered security guard, an alarm system, and several security measures to ensure operational security. Furthermore, the Chief of Police has the authority to require additional reasonable security measures as part of the department’s review of the applicant’s security plan. In addition to the security measures of the Operational Permit, the Planning Board approved the project with additional security requirements, including requiring a lighting plan as part of the project’s security plan. The Planning Board conditions of approval mirror those of the first dispensary on Webster Street, which has been open to the public since March 2020 and subject to the same conditions of approval. The City has not received any security related complaints since the Webster Street dispensary opened to the public.
Appellant Argument #3 - Operational Radius Guidelines. Appellant argues the City’s operational radius regulation is contrary to state law and the City lacks the authority to specify an operational radius less than 600 feet.
Staff Response: The Planning Board approved the project, in part, because it was conditioned on compliance with all applicable laws, including the Cannabis Business Regulations. Alameda’s local rules concerning operational radii, under AMC Section 6-59.10.e.1., were adopted in 2017 pursuant to state law (SB 94). Under state law, local jurisdictions are expressly authorized to specify a different radius and measurement rule. See Business & Professions Code Section 26054(b) (stating the 600-foot radius applies “unless, a licensing authority or a local jurisdiction specifies a different radius. The distance specified in this section shall be measured in the same manner as provided in subdivision (c) of Section 11362.768 of the Health and Safety Code unless otherwise provided by law.”) (Emphasis added.)
The authority of local jurisdictions to specify operational radii has been made clear by BCC, the state regulatory agency charged with regulating commercial cannabis businesses. BCC adopted a regulation that expressly provides that it may issue a state license to a commercial cannabis business even if the proposed business fails to meet the 600-foot radius under state law so long as the applicant provides proof of local approval. 16 CCR § 5026(b). In a comment matrix, accompanying the final statement of reasons for such regulation, BCC resolved all doubt on this issue when it opined that local jurisdictions may adopt an operational radius less than 600 feet:
Appellant Argument #4 - Public Notice/Flawed Hearing. Appellant raises various claims regarding the validity of the public hearing. The Appeal raises the following:
A. Appellant claims that the City did not provide adequate notice for the August 17, 2020 Special Meeting of the Planning Board, and that interested parties were not provided a means to access project documents.
Staff Response: Staff properly noticed the Planning Board public hearing pursuant to applicable State and local laws. The Planning Board’s August 17, 2020 public hearing was noticed in accordance with noticing requirements in State Planning and Zoning Law and the AMC (including Sections 30-21.7), and included a mailed notice to the owners of property within 300 feet of the project site, one (1) on-site posting, and a newspaper advertisement (Exhibit 3, Public Notice). No additional notice is required, and Appellant has offered no evidence that these notices were defective in any way or cited to any legal authority to support his conclusion that additional notice is required.
The mailed public notice stated that project materials are accessible through the City’s website or by contacting the Project Planner directly, and provided that Project Planner’s phone number and email address. Several other members of the public contacted staff prior to the public hearing and received electronic copies of the project materials.
B. Appellant also claims that the hearing was flawed because the Planning Board approved delivery, directed the applicant to return with modified design review drawings, and approved a 10pm closing time when the applicant only requested a 9pm closing time.
Staff Response: The public hearing process was not flawed. The applicant may request approval to conduct delivery as part of its application for an Operator’s Permit, because the proposed use is a retail use, and is no different than other retail uses in the same zoning district (e.g., the adjacent restaurant provides takeout and delivery). In addition, the Planning Board has discretion to direct the applicant to modify its design review drawings for subsequent approval, as it did at the public hearing. The Planning Board did, however, incorrectly extend the storefront hours of operation to 10:00 PM, which exceeds the hours of operation permitted by the Cannabis Business Regulations. AMC Section 6-59.10(o) provides that storefront hours of operation may be between the hours of 7:00 AM to 9:00 PM, and that delivery, distribution, or pick-up of a substantial amount of cash, cannabis, or cannabis product is prohibited between the hours of 10:00 PM and 7:00 AM. Additionally, the applicant only requested to operate until 9:00 P.M. Accordingly, Staff recommends that the City Council modify the conditions of approval to limit the hours of operation as follows: “Hours of Operation: On premises public serving business hours shall be limited to between 9:00 AM and 9:00 PM. Deliveries to the Dispensary shall not be accepted between the hours of 10:00 PM and 7:00 AM.”
Staff Conclusions: The Planning Board considered the application, the public testimony, and all other evidence in the record, and approved the Use Permit application based on the required Use Permit Findings set forth in Exhibit 1. The Appellant has not raised any concerns that warrant City Council’s action to overturn or reverse the Planning Board’s decision to approve the use permit.
Therefore staff recommends that the City Council approve the use permit, thereby upholding the Planning Board’s decision, subject to modified conditions of approval. If the Use Permit is approved, the next step is for the applicant to obtain an Operator’s Permit. The City’s Operator’s Permit process allows the City to revoke the Operator’s Permit if the operator violates any applicable law or any condition of approval, fails to maintain adequate systems for air quality, odor control, and ventilation, or fails to maintain adequate security measures to protect the property and surrounding neighborhood.
ALTERNATIVES
The City Council may:
• Uphold the Planning Board’s decision to approve the use permit,
• Uphold and modify the Planning Board’s decision by adding or modifying conditions, as recommended by staff,
• Remand the decision back to the Planning Board for further consideration, or
• Deny the use permit with revised findings.
FINANCIAL IMPACT
Denying the Appeal and affirming the Planning Board’s decision will have no impact on the General Fund. The Appellant is responsible for paying all expenses associated with the Appeal.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
As described in this report, staff has determined that the proposed project is consistent with the General Plan and Zoning Code requirements for the site, in addition to the City’s cannabis regulations (codified at AMC sections 30-10 and 6-59.1 et seq.). General Plan Policy 2.5.a calls for providing enough retail business and services to provide Alameda residents with a full range of services. The project conditions of approval require funding for two new bicycle racks and membership with the ATMA, which relates favorably to Implementing Policy 2.5.s, which calls for improving public transit service and transit facilities in retail areas. The funding for bicycle racks will provide new transit facilities within the Park Street business district and membership in the ATMA will result in the distribution of an ACTransit EasyPass to each employee and increase demand for public transit in the Webster Street business district.
ENVIRONMENTAL REVIEW
Denying the Appeal and approving the Use Permit is exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Sections 15183 (projects consistent with General Plan and Zoning) and 15301 (existing facilities - operation, permitting or leasing of existing private structures involving negligible or no expansion of use beyond that which exists), each as a separate and independent basis.
CLIMATE IMPACTS
The proposed cannabis business is consistent with the Climate Action and Resiliency Plan goals to reduce carbon footprint in that it provides local residents with another outlet for cannabis products without having to drive off the island. The proposed project also includes transportation demand management measures to reduce vehicular traffic and greenhouse gas emissions and encourage the use of other climate friendly modes of travel like walking, biking and public transit.
RECOMMENDATION
Hold a public hearing and adopt a resolution denying the Appeal, and approving Use Permit Application No. PLN20-0160, based on the findings and subject to modified conditions of approval.
CITY MANAGER RECOMMENDATION
The City Manager recommends denying the Appeal of the Planning Board’s decision and approve the Use Permit Application No. PLN20-0160 based on the findings and subject to conditions of approval.
Respectfully submitted,
Andrew Thomas, Planning, Building & Transportation Director
Financial Impact section reviewed,
Nancy Bronstein, Acting Finance Director
Exhibits:
1. Planning Board Resolution No. PB-20-19
2. Appeal
3. Public Notice
4. Project Plans
cc: Eric Levitt, City Manager