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Regulations on Commercial Cannabis Activities in the City of Tracy

California state law allows local governments to regulate commercial cannabis activities in their respective jurisdictions.  On December 3, 2019, the City Council of the City of Tracy adopted Ordinance 1277 establishing regulations for commercial cannabis activity in the City of Tracy and Ordinance 1278 establishing zoning and locational requirements on commercial cannabis activity in Tracy.

All commercial cannabis businesses, including cultivation (indoor only), distribution, manufacturing, microbusiness, retailer – non-storefront (delivery only), retailer – storefront (dispensary), and testing laboratory, are required to obtain a Cannabis Business Permit, a Conditional Use Permit (CUP) from the Planning Commission, a State License issued by the Bureau of Cannabis Control, and must be in compliance with all applicable state and local laws and regulations pertaining to cannabis business and the commercial cannabis activities and land use and zoning requirements prior to operating in the City of Tracy.

Updates (as of 2020): 

The City’s regulatory ordinance on commercial cannabis activities, contained in Chapter 6.36 of the Tracy Municipal Code, requires that the City Council adopt, by resolution, procedures to govern the cannabis business permit application process (Tracy Municipal Code Section 6.36.050(a).) The City is continuing to evaluate Application Procedures and Guidelines for the eventual opening of an application period for Cannabis Business Permits.  The City will be evaluating the Guidelines and establishing an application opening date later this year.

Cannabis Ordinances & Regulations 

Information related to regulations on commercial cannabis activity and zoning requirements on commercial cannabis activity can be found by clicking on the links below or by accessing the City’s Municipal Code

Chapter 6.36 Commercial Cannabis Activity (Ordiance 1277)

Section 10.08.3196 of Chapter 10.8 Zoning Regulations

Background: 

On June 27, 2016, the State enacted the Medical Cannabis Regulatory Safety Act (MCRSA) to protect residents’ use of medical cannabis and to establish regulations for personal and commercial medical cannabis activity. On November 8, 2016, California voters passed Proposition 64, the Adult Use of Marijuana Act (AUMA) to regulate personal and commercial non-medical marijuana activity. On January 1, 2018 the State began issuing temporary commercial licenses for medicinal and non-medicinal cannabis. Many California cities and counties are now implementing local cannabis regulations.

Timeline:

· July 25, 2018: An ordinance to allow up to two medical cannabis non-storefront (i.e. delivery only) dispensaries to operate in the City’s industrial locations was prepared by City Staff; it was introduced to the City of Tracy Planning Commission. 

· September 18, 2018: The proposed cannabis ordinance and operational regulations was presented to the Tracy City Council for further discussion.

· February 5, 2019:  At the City Council meeting, staff was directed to draft a regulatory ordinance that 1) allows all cannabis businesses except cultivation; 2) allows the location of these businesses in industrial and possibly commercial and other areas of the City; and 3) restricts the number of dispensaries to two with the possibility of more. Council further directed staff to research best practices from other agencies and draft an ordinance with the highest regulatory standards with an emphasis on cost recovery.

· August 13, 2019: A Special City Council meeting was held to discuss potential regulations for commercial cannabis activity and provide direction to staff. The workshop had two primary areas of discussion: land use regulations and cost recovery models. City Council provided direction to staff related to locational requirements for various cannabis business types. At that meeting, it was established that storefront retail cannabis businesses (dispensaries) would be permitted in commercial and industrial areas of the City, and that the more industrial-in nature cannabis businesses (distribution, indoor cultivation, micro-businesses, testing laboratories, manufacturing) would be permitted in industrial areas. All businesses would be required to first obtain a Conditional Use Permit from the Planning Commission in order to operate. Full details regarding what happened at this special meeting can be found by watching theCouncil Meeting video or reading the discussion summary.

· September 3, 2019: A Special City Council meeting was held to further discuss land use considerations and begin the policy discussion on the commercial cannabis activity regulatory permit. The City Council provided further direction on types of business activities, including outdoor cultivation and volatile manufacturing. In addition, the Council discussed and provided direction for specific regulations that are above the minimums established by State cannabis regulations which include Proposition 64 and implementing laws and regulations such as Medicinal and Adult Use Cannabis Regulation and Safety Act (“MAUCRSA”). Full details regarding what happened at this special meeting can be found by watching the Council Meeting video or reading the discussion summary

· October 1, 2019:  A Special City Council meeting was held to highlight the sections of the ordinance that incorporated the Council’s prior direction. To review those details, please read the agenda.

· November 5, 2019:  At the Regular Council Meeting, the Council introduced Ordinances amending Chapter 6.36 if the Tracy Municipal Code regarding Commercial Cannabis Activity and amending Section 10.08.3196 of the Tracy Municipal Code regarding establishing Zoning and Location Requirements for Commercial Cannabis Businesses

· December 3, 2019: At a Regular Council Meeting, the City Council adopted Ordinance 1277 and Ordinance 1278  establishing regulations for commercial cannabis activity in the City of Tracy and Ordinance 1278 establishing zoning and locational requirements on commercial cannabis activity in Tracy.

· January 21, 2020:  At a Regular Council Meeting, the Council considered and discussed draft procedures and guidelines (“Guidelines”) for the cannabis business permit application process. Staff requested Council direction in order to finalize these proposed Guidelines for cannabis business permit applications. The City’s regulatory ordinance on commercial cannabis activities, contained in Chapter 6.36 of the Tracy Municipal Code (“TMC”), requires that the City Council adopt, by resolution, the procedures to govern the cannabis business permit application process (TMC Section 6.36.050(a).).  The Council directed staff to return to Council with revised draft Guidelines.  Full details regarding what happened at this Regular Meeting can be found by watching the Council Meeting video.

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