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City voters may get say on dispensaries for recreational pot

OCEANSIDE — Proponents of a petition that would ask voters to allow for recreational cannabis dispensaries in town are hopeful about getting their cause on the ballot this year.

Last November, a petition began circulating to put the Oceanside Safe Cannabis Act on the November 2020 ballot. Proponents have until the beginning of May to gather 10,000 valid signatures to get the initiative on the ballot.

According to Dallin Young, a member of the Oceanside Voters for Safe Access coalition, petitioners are aiming to gather between 13,000 and 15,000 signatures to make up for any signatures that may be considered invalid.

If enacted, the Oceanside Safe Cannabis Act would amend the city’s current regulations for cannabis businesses.

Currently, the city allows cultivation, nurseries, manufacturing, distribution, testing laboratories and non-storefront retailers providing cannabis deliveries only for medical purposes. These businesses are required to obtain a local license from the city manager and a conditional use permit (CUP) from council.

Dispensaries with storefronts are not currently allowed in Oceanside, but the initiative would change that for both recreational and medical purposes. It would also allow for “cannabis microbusinesses” which includes at least three of the following uses: cultivation, manufacturing, distribution and retail sales.

Proponents of the initiative believe the city should “fully implement” the state’s Adult Use of Marijuana Act.

According to Young, the initiative would help Oceanside get rid of its black-market cannabis sales.

“Just because we can’t purchase in the recreational market legally doesn’t mean these sales aren’t taking place in the black market,” Young said. “We want to allow for more legal sales to get rid of the black market and get revenue back to city and know who the main players are.”

Young said that if the city were to legalize recreational cannabis businesses, it would ensure cannabis products being sold in the city are being thoroughly tested before they hit the retail shelves. The city would also be able to keep track of exactly where the product is coming from if recreational businesses were allowed, he added.

With the initiative, storefront dispensaries would be allowed in all commercial and industrial zones while micro-businesses would only be allowed in industrial zones. Additionally, the initiative calls to allow cannabis retailers and microbusinesses in good standing to create spaces where onsite consumption of cannabis products could occur.

The initiative would also eliminate the requirement for business operators to obtain a CUP, meaning cannabis business applications will no longer be reviewed at public hearings before the Planning Commission and council. Cannabis business operators would still need a local license from the city manager as well as from the state.

Eliminating the need for a CUP will make the city’s cannabis industry more equitable, according to Young.

“If you look at the cannabis industry throughout the state, it’s dominated by people with a lot of money,” Young said.

The process of obtaining a CUP on top of the necessary licenses is expensive and time-consuming, Young said, preventing people with lower incomes from starting their own businesses in the industry. Instead of obtaining a CUP, the initiative would allow for applicants to obtain a by-right permit, which he said is a less expensive and less time-consuming process.

The initiative would also prevent the city from limiting the total number of local licenses issued for cannabis businesses. Councilwoman and mayoral candidate Esther Sanchez is not a fan of this concept.

“I support medicinal dispensaries, but not unlimited recreational shops anywhere in our city,” Sanchez told The Coast News.

Other changes include modifying current city law that requires cannabis businesses to be at least 1,000 feet from other cannabis businesses and from churches, schools, childcare facilities, parks and beaches to the 600-foot separation requirement in the California Code of Regulations between cannabis businesses and schools, daycares and youth centers.

Kyle Krahel, chair of the Planning Commission, is one of the petition’s proponents. His main reasoning for supporting the initiative is to get rid of the city’s cannabis black market to make Oceanside safer.

“Moving adult-use cannabis out of the black market and entering strong regulations can help improve the safety of our community and on top of that provide much-needed revenue,” Krahel said.

The initiative includes an excise tax that would not exceed 5% on gross receipts of cannabis retailers, manufacturers, distributors and a $2 per dry ounce tax on cultivators. Council could also set a lower excise tax, and funds from the tax could be used for “community benefits in low-income areas.”

A “Social Equity Commission” would be established to advise council on cannabis issues and requires that the commission include members who have been convicted of a “cannabis offense.” It would also include “social justice advocates” and members of impacted communities.

Additionally, the initiative creates a “social equity program” to help cannabis business owners and operators who have a cannabis offense conviction or who are low income. It also requires cannabis employers to use “good faith efforts” to ensure at least 25% of their employees have a conviction for a cannabis offense or are low income.

Krahel said he is “especially proud” of the social equity program element.

“This piece sets revenue aside for financial support so that we can get folks who are traditionally not able to start small businesses help and access to low-interest loans,” he said, adding that this piece will particularly benefit people of color and women who have been “traditionally marginalized” as entrepreneurs and small business owners.