With recreational sales beginning in California on January 1, 2018, the City of San Diego has developed a website to explain the permitting and application process for established and emerging companies in the cannabis industry. The website is part of an effort on the part of the City of San Diego to help individuals and companies understand Ordinance No. O-20793 (passed February 22, 2017) and Ordinance No. O-20859 (passed October 17, 2017), which amend the Land Development Code and the Local Coastal Program.
Though the City of San Diego’s regulatory guidance website is not meant to provide a comprehensive overview of the patchwork of permitting and licensing laws that apply at the city-level to marijuana businesses, it is a good starting point.
The website provides an overview for those subject to the ordinances: Marijuana Production Facilities, Marijuana Outlets and Marijuana Testing Facilities.
- Marijuana Production Facilities are cultivators and include individual or combined facilities engaged in the agricultural raising, harvesting and processing of marijuana; wholesale distribution and storage of marijuana and marijuana products; and production of goods from marijuana and marijuana products consistent with the requirements of the California Departments of Food and & Agriculture, Consumer Affairs, and Public Health.
- Marijuana Outlets are dispensaries and any establishment (retail, medicinal or combination) operating with a Conditional Use Permit where marijuana, products and accessories are publicly sold.
- Marijuana Testing Facilities include those facilities testing for scientific research that leads to the development of new cannabis products and processes.
Cultivators must comply with the City’s Separation and Special Operating Requirements. The Separation Requirements specifically apply to Marijuana Production Facilities:
- Must be 1,000 feet from public parks, churches, childcare, playgrounds, libraries, minor oriented facilities, residential care facilities and schools; and
- Must also be 100 feet from residential zones
Additionally, the Special Operating Requirements for cultivators are also identified:
- Retail sales strictly prohibited at these sites
- Facilities must be entirely enclosed
- No outdoor storage or operations
- Lighting and security features must be installed, including operable cameras, alarms and security guard
- Emergency contact information must be displayed from a public right-of-way
- No signage is allowed and only the address is permitted
- Requirements for background and fingerprinting (as applied to Marijuana Outlets)
The website also reminds businesses of the prohibitions under Proposition 64, which prohibit sale and distribution of marijuana products at special events, outdoor growing of personal residential marijuana and smoking in public places or on business premises.
These regulations are part of a series of licensing and permitting, corporate, employment, banking, tax, real estate and land use, intellectual property and general business and regulatory issues that businesses must face as they break into the nation’s most lucrative legal cannabis market at the start of the new year.
Duane Morris is among the largest full-service law firms serving the needs of the industry, including its cultivators, dispensaries and related enterprises. For more information about our work in this area, see the Cannabis Industry at a Glance.