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CC RESOLUTION 5340RESOLUTION NO. 5340 A RESOLUTION SUBMITTING TO THE VOTERS AN ELECTIONS CODE § 9222 CITY INITIATIVE AMENDING PORTIONS OF EL SEGUNDO MUNICIPAL CODE TITLES 4 AND 15 TO REGULATE AND PERMIT COMMERCIAL CANNABIS, REQUESTING LOS ANGELES COUNTY TO PROVIDE SPECIFIC ELECTION SERVICES, AND SETTING REQUIREMENTS FOR FILING WRITTEN ARGUMENTS AND REBUTTALS, AND DIRECTING THE CITY ATTORNEY TO PREPARE AN IMPARTIAL ANALYSIS. The City Council of the city of El Segundo does resolve as follows: SECTION 1. Findings. The City Council finds and declares as follows: A. The City Council adopted Resolution No. 5337 to call and give notice of the City's general municipal election (the "City Election") to take place on November 8, 2022. B. The City Council adopted Resolution No. 5338 requesting Los Angeles County (the "County") to consolidate the City Election with the County -administered general election to also be held on November 8, 2022. C. The City Council requests that the County's consolidation of the City Election include the ballot measure proposed in this Resolution for all relevant purposes. D. Elections Code § 9222 authorizes the City Council to submit an initiative for voter approval without a petition. E. The City Council seeks to submit a City commercial cannabis regulatory initiative to the voters pursuant to Elections Code § 9222 (the "City Initiative"). F. The City Council also seeks to: request the County to provide certain election services; set priorities for the filing of written arguments and rebuttals for the Initiative; and direct the City Attorney to prepare an impartial analysis of the City Initiative. SECTION 2. Submission of Voter Initiative to Voters. A. Pursuant to Elections Code § 9222, the City Council places the City Initiative on the ballot for the City Election scheduled for November 8, 2022. The form of the City Initiative is attached hereto as Exhibit "A" RESOLUTION No. 5340 PAGE 1 B. The City Initiative will be printed in the City Election ballots in substantially the following form: City Initiative for Commercial Cannabis Regulation. Shall an ordinance be adopted to repeal the City's current YES prohibition on commercial cannabis activities to authorize commercial cannabis retailers east of Pacific Coast Highway in the Multimedia Overlay District by right, of no less than 1,750 square feet, with sensitive receptor - .-... buffers and away from major arterial frontages, subject to NO a City permitting process; and authorize the City Council to subsequently regulate non -retail cannabis businesses? C. The vote requirement for passage of the proposed ballot measure is a majority of the votes cast (50% plus 1). SECTION 3. Request for County Election Services. A. In addition to the previously requested consolidation of the City Election and related request for associated County services, the City Council requests the County, with respect to the City Initiative to take any and all additional steps necessary for the holding of the City Election requested to be consolidated, including, without limitation, mailing of the ballot question, ballot arguments, rebuttals, and the City Attorney's impartial analysis to voters and canvassing the election results. B. The City will reimburse the County for additional costs imposed by the addition of the proposed City Initiative ballot measure to the City Election ballot. SECTION 4. Ballot Arguments and Rebuttals. A. All arguments and rebuttals for the City Initiative ballot measure must comply with Elections Code § 9280 et seq., including, without limitation, the following requirements: 1. Ballot arguments must not exceed 300 words in length; 2. Ballot arguments cannot be accepted unless accompanied by the printed name and signature or printed names and signatures of the author or authoirs submitting it, or if submitted on behalf of an organization, the name of the organization and the printed name RESOLUTION NO. 5340 PAGE 2 and signature of at least one of its principal officers who is the author of the argument. 3. No more than five signatures may appear with any ballot argument submitted. B. Pursuant to Elections Code § 9282(b), the City Council authorizes all its members to file a written argument for the City Initiative ballot measure on behalf of the City Council. C. Pursuant to Elections Code § 9282(b), an indivdual voter who is eligible to vote on the City Initiative ballot measure, or a bonafide association of citizens, or a combination of voters and associations may file a written argument for or against the City Initiative ballot measure. D. Ballot arguments must be submitted to the City Clerk on or before August 19, 2022. E. Pursuant to Elections Code § 9285(a), the City Clerk will send a copy of the selected arguments for and against the City Initiative ballot measure to the necessary parties. F. The authors of arguments for or against the City Initiative ballot measure may prepare and submit a rebuttal argument or authorize, in writing, nother person or persons to prepare, submit, or sign the rebuttal. G. The authors of arguments for or against the City Initiative ballot measure must submit any rebuttal to the City Clerk on or before August 29, 2022. H. Rebuttals may not exceed 250 words in length. SECTION 5. City Attorney Impartial Analysis. The City Council directs the City Clerk to deliver a copy of the City Initiative ballot measure to the City Attorney who will prepare an impartial analysis of the proposed measure pursuant to Elections Code § 9280. The City Attorney must file the impartial analysis with the City Clerk on or before August 19, 2022 and may not exceed 500 words in length. SECTION 6. Environmental Review. The provisions of the proposed City Initiative were reviewed pursuant to the California Environmental Quality Act (Public Resources Code §§ 21000, et seq., "CEQA") and the regulations promulgated thereunder (14 Cal. Code of Regulations §§15000, et seq., the "CEQA Guidelines"). Based upon that review, the actions contemplated therein are exempt from CEQA, pursuant to: CEQA Guidelines § 15061(b)(3), the "common sense" RESOLUTION No. 5340 PAGE 3 exemption"; categorical exemption Class 8 (Actions by Regulatory Agencies for the Protection of the Environment), per CEQA Guidelines § 15308, without qualifying for any exceptions to the exemptions, as set forth in CEQA Guidelines § 15300.2; and CEQA Guidelines § 15783 (Projects Consistent with Zoning). SECTION 7. Electronic Signatures. This Resolution may be executed with electronic signatures in accordance with Government Code §16.5. Such electronic signatures will be treated in all respects as having the same effect as an original signature. SECTION 8. Signature Authority. The Mayor, or presiding officer, is hereby authorized to affix his signature to this Resolution signifying its adoption by the City Council of the City of El Segundo, and the City Clerk, or her duly appointed deputy, is directed to attest thereto. SECTION 9. Effective Date. This Resolution will take effect immediately upon adoption and will remain effective unless repealed or superseded. SECTION 10. City Clerk Actions. The City Clerk will certify to the passage and adoption of this Resolution, enter it in the City's book of original Resolutions, and make a record of this action in the meeting's minutes. The City Clerk is directed to file a certified copy of this Resolution with the County. PASSED AND ADOPTED this 7t" day of June, 2022. ATTEST: U) mazl'v Tracy Weavcyr, City Clerk APPROVED AS TO FORM: MARK HF4NSLEY, CITY ATTORNEY Joaquin Vazquez, Deputy City Attorney l Drew Boyles, Mayor RESOLUTION No. 5340 PAGE 4 CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) SS CITY OF EL SEGUNDO ) I, Tracy Weaver, City Clerk of the City of El Segundo, California, do hereby certify that the whole number of members of the City Council of said City is five; that the foregoing Resolution No. 5340 was duly passed, approved, and adopted by said City Council at a regular meeting held on the 7t" day of June, 2022, approved and signed by the Mayor Pro Tem, and attested to by the City Clerk, by the following vote: AYES: Mayor Boyles, Council Member Pirsztuk, Council Member Nicol and Council Member Giroux NOES: Mayor Pro Tern Pimentel ABSENT: None ABSTAIN: None WITNESS MY HAND THE OFFICIAL SEAL OF SAID CITY this day of June, 2022. acy Weaver, MCity Clerk of the City of El Segundo, California EXHIBIT "A" CITY INITIATIVE RESOLUTION No. 5340 PAGE 6 THE PEOPLE OF THE CITY OF EL SEGUNDO DO ORDAIN AS FOLLOWS: SECTION 1. This measure shall be known and may be cited as the City of El Segundo Safe Cannabis Business Measure (the "Measure"). SECTION 2. Purpose and Intent. The purpose and intent of this Measure is to safely and legally accommodate the needs of medically -ill persons in need of cannabis for medicinal purposes, as advised and recommended by their health care provider(s), and adults over the age of twenty-one (21), and to implement State of California ("State") law, which includes, but is not limited to the provisions of the Medicinal & Adult -Use Cannabis Regulation & Safety Act (hereinafter, "MAUCRSA"), as may be amended and augmented under State law, while imposing regulations on the conduct of business and use of land to protect the City of El Segundo's (the "City") neighborhoods, residents, and businesses from negative impacts. It is a further purpose and intent of this Measure to regulate the cultivation, manufacturing, processing, testing, distribution, and retail sale and delivery of cannabis and cannabis products in a manner which is responsible, which protects the health, safety, and welfare of the residents of the City, and which enforces rules and regulations consistent with State law. In part to meet these objectives, a commercial cannabis business permit shall be required to own or to operate a cannabis business within the City. Further, this Measure's requirement for a cannabis business to possess commercial cannabis business permit is in addition to any other permits, licenses, and approvals which may be required to conduct business in the City, and is in addition to any permits, licenses, and approvals required under State or County of Los Angeles ("County") law. SECTION 3. Legal Authority, rim Pursuant to Section 7 of Article XI of the California Constitution, and the provisions of the MAUCRSA, as may be amended and augmented under State law and any subsequent State legislation regarding the same, the City is authorized to adopt ordinances that establish standards, requirements, and regulations for local licenses and permits for commercial cannabis activity. Except as otherwise provided in this Measure, any standards, requirements, and regulations regarding health and safety, security, and worker protections established by the State, or any of its departments or divisions, shall be the minimum standards applicable to commercial cannabis activity in the City. The City has brought forth the Measure in accordance with Elections Code Section 9222. SECTION 4. Chapter 14 (Marijuana) of Title 4 (Business Regulations and Licensing) of the City Municipal Code is hereby repealed in its entirety and amended to read as follows: Chapter 14: COMMERCIAL CANNABIS ACTIVITY 4-14-1: Commercial Cannabis Activity Prohibited Unless Specifically Authorized. A. If cannabis products are delivered to persons or businesses located within the City from businesses located outside the City, such cannabis businesses shall be required to comply with the requirements set forth in this Chapter 14, including the City commercial cannabis business permit application and approval process under Section 4-14-7. B. Nothing in this Chapter 14 shall be construed or interpreted to permit the commercial possession, furnishing, manufacture, cultivation, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery, or sale of industrial hemp. Notwithstanding the foregoing, the City may authorize and regulate such activities related to industrial hemp pursuant to its police powers without seeking voter authorization; the City does retain the authority to submit such questions of authorization and regulation to the voters pursuant to Elections Code section 9222. C. To the extent expressly authorized in this Chapter 14 and Title 15 of the City Municipal Code, the following types of commercial cannabis activity are permitted in the City, subject to the satisfaction of all requirements set forth in this Chapter 14, Title 15 of the City Municipal Code, MAUCRSA, and all other applicable State and local laws, rules, and regulations: Retail sales 2. Cultivation 3. Manufacturing 4. Distribution 5. Testing laboratory 6. Microbusinesses. 4-14-2: Compliance with Laws. It is the responsibility of the owners, managers, officers, employees, and agents of any cannabis business to ensure that it is operating in a manner compliant with all applicable State and local laws and any regulations promulgated thereunder. Nothing in this Chapter 14 shall be construed as in conflict with State law. 4-14-3: Definitions. When used in this Chapter 14, the following words shall have the meanings ascribed to them as set forth herein. Any reference to State statutes includes any regulations promulgated thereunder and is deemed to include any successor or amended version of the referenced statute or regulatory provision. APPLICANT: The person applying for the commercial cannabis business permit under this Chapter 14 (not the owners or the managers of the applicant). CANNABIS: All parts of the Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. "Cannabis" also means the separated resin, whether crude or purified, obtained from cannabis. "Cannabis" also means marijuana as defined by Section 11018 of the State Health & Safety Code, as may subsequently be amended or recodified. Cannabis does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this Chapter 14, cannabis does not mean industrial hemp as that term is defined by Section 81000 of the State Food & Agricultural Code or Section 11018.5 of the State Health & Safety Code, as such sections may subsequently be amended or recodified. 2 CANNABIS BUSINESS: A person engaged in commercial cannabis activity. CANNABIS PRODUCT: Cannabis that has undergone a process whereby the plant material has been transformed into a concentrate, including, but not limited to, concentrated cannabis, or an edible or topical product containing cannabis or concentrated cannabis and other ingredients. CAREGIVER or PRIMARY CAREGIVER has the same meaning as that term is defined in Section 11362.7 of the State Health & Safety Code, as may subsequently be amended or recodified. CHIEF OF POLICE: The Police Chief of the City of El Segundo Police Department or designee(s). CITY: The City of El Segundo, a municipal corporation organized under the general laws of the State. CITY ATTORNEY: The City Attorney of the City of El Segundo or designee(s), CITY COUNCIL: The City Council of the City of El Segundo. CITY MANAGER: The City Manager of the City of El Segundo or designee(s).. COMMERCIAL CANNABIS ACTIVITY has the same meaning as that term is defined under MAUCRSA and includes the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery, or sale of cannabis and cannabis products as regulated under this Chapter 14. COMMERCIAL CANNABIS BUSINESS PERMIT: A regulatory license issued by the City pursuant to this Chapter 14 to a cannabis business and is required before any commercial cannabis activity may be conducted in the City and is made expressly contingent upon the cannabis business's ongoing compliance with all of the requirements of this Chapter 14 and any regulations adopted by the City governing the commercial cannabis activity at issue. CANNABIS CONCENTRATE: Cannabis that has undergone a process to concentrate one or more active cannabinoids, thereby increasing the product's potency. Resin from granular trichomes from a cannabis plant is a concentrate for purposes of this Chapter 14. A cannabis concentrate is not considered food, as defined by Section 109935 of the State Health & Safety Code, as may subsequently be amended or recodified, or drug, as defined by Section 109925 of the State Health & Safety Code, as may subsequently be amended or recodified. COUNTY: The County of Los Angeles. CULTIVATION: Any activity involving the planting, growing, harvesting, drying, curing, grading, or trimming of cannabis. CULTIVATION SITE: A location where cannabis is planted, grown, harvested, dried, cured, graded, or trimmed, or a location where any combination of those activities may occur. Cultivation sites must be licensed by the City and State pursuant to this Chapter 14. CUSTOMER: A natural person 21 years of age or over or a natural person 18 years of age that is a qualified patient or primary caregiver. KI DAY CARE CENTER or CHILDCARE FACILITY: A facility serving infant, toddler, preschool, and school age children licensed by the State Department of Social Services pursuant to Section 1596.951 of the State Health & Safety Code, as may subsequently be amended or recodified. Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, this definition of "day care center" under this Chapter 14 shall override the definition of "day care center" in MAUCRSA at Section 26001 of the State Business & Professions Code, as may subsequently be amended or recodified. DELIVERY: The commercial transfer of cannabis or cannabis products to a customer. "Delivery" also includes the use by a retailer of any technology platform owned and controlled by the retailer. DISPENSARY or RETAILER: A location where cannabis, cannabis products, or devices for the use of cannabis or cannabis products are offered, either individually or in any combination, for retail sale onsite directly to customers at the location or via delivery from the establishment to customers offsite. DISPENSING or RETAIL SALE(S): Any activity involving the retail sale of cannabis or cannabis products from a retailer onsite directly to customers or via delivery from the retailer to customers offsite. DISTRIBUTION: The procurement, sale, and transport of cannabis and cannabis products between persons lawfully conducting commercial cannabis activity under this Chapter 14 and State law. DISTRIBUTOR: a person engaged in the distribution of cannabis and cannabis products, who is based within the City, and licensed by the City and State pursuant to this Chapter 14. EDIBLE CANNABIS PRODUCT: A cannabis product that is intended to be used, in whole or in part, for human consumption, including, but not limited to, chewing gum, but excluding products set forth in Division 15 (commencing with Section 32501) of the State Food & Agriculture Code, as may subsequently be amended or recodified. An edible cannabis product is not considered food, as defined by Section 109935 of the State Health & Safety Code, as may subsequently be amended or recodified, or drug, as defined by Section 109925 of the State Health & Safety Code, as may subsequently be amended or recodified. An edible cannabis product shall not be deemed to be adulterated pursuant to Section 26131 of the State Business & Professions Code, as may subsequently be amended or recodified, solely because it contains cannabis. EMPLOYEE: Each individual person employed by a cannabis business who is a part-time, full- time, temporary, or permanent employee. GROSS RECEIPTS: Except as otherwise specifically provided herein, whether designated as a sales price, royalty, rent, commission, dividend, or other designation, the total amount (including all receipts, cash, credits, and property of any kind or nature) received or payable for sales of goods, wares, or merchandise without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor, or service costs, interest paid or payable, losses, or any other expense whatsoever. However, the following shall be excluded from gross receipts: A. Cash discounts where allowed and taken on sales; B. Any tax required by law to be included in or added to the purchase price and collected from the consumer or purchaser; 4 C. Such part of the sale price of any property returned by purchasers to the seller as refunded by the seller by way of cash or credit allowances or return of refundable deposits previously included in gross receipts; D. Receipts derived from the occasional sale of used, obsolete, or surplus trade fixtures, machinery, or other equipment used by the taxpayer in the regular course of the taxpayer's business; E. Cash value of sales, trades, or transactions between departments or units of the same business; F. Whenever there are included within the gross receipts amounts which reflect sales for which credit is extended and such amount proved uncollectible in a given year, those amounts may be excluded from the gross receipts in the year they prove to be uncollectible; provided, however, if the whole or portion of such amounts excluded as uncollectible are subsequently collected, they shall be included in the amount of gross receipts for the period when they are recovered; and G. Receipts of refundable deposits, except that such deposits when forfeited and taken into income of the business shall not be excluded when in excess of one dollar. LICENSING AUTHORITY: A State agency responsible for the issuance, renewal, or reinstatement of State license, or a State agency authorized to take disciplinary action against a State licensee. LIQUID ASSETS: Assets that can be readily converted into cash. "Liquid assets" include, but are not limited to, the following: funds in checking or savings accounts, certificates of deposit, money market accounts, mutual fund shares, publicly traded stocks, and United States savings bonds. "Liquid assets" does not mean household items, furniture and equipment, vehicles, cannabis or cannabis products, business inventory, or real property and improvements thereto. LIVE PLANTS: Living cannabis flowers and plants, including seeds, immature plants (including unrooted clones), and vegetative stage plants. MAJOR ARTERIAL: Those streets specified as major arterials in the Master Plan of Streets included in the 2004 Circulation Element to the City's General Plan as Exhibit C-10 and the portion of Imperial Highway east of Pacific Coast Highway. MANAGER: Any individual who will be participating in the direction, control, or management of an applicant or a permittee, including but not limited to, any (i) manager or managing member or other officer of a limited liability company or (ii) president, chief executive officer, secretary, treasurer, chief financial officer, or other officer of a for profit corporation. MANUFACTURE(ING): To compound, blend, extract, infuse, or otherwise make or prepare a cannabis product. MANUFACTURER: A person that conducts the production, preparation, propagation, or compounding of cannabis or cannabis products either directly or indirectly or by extraction methods, or independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis at a fixed location that packages or repackages cannabis or cannabis products 5 or labels or relabels its container. A manufacturer may also be a person that infuses cannabis in its products but does not perform its own extraction. MANUFACTURING SITE: A location where cannabis or cannabis products, directly or indirectly are produced, prepared, propagated, or compounded by extraction methods, independently by means of chemical synthesis, or by a combination of extraction and chemical synthesis. MARIJUANA means "cannabis" as that term is defined in this Chapter 14. MAUCRSA: Division 10 (commencing with Section 26000) of the State Business and Professions Code, as may subsequently be amended or recodified, and any regulations promulgated thereunder. MEASURE: City of El Segundo Safe Cannabis Business Measure. MICROBUSINESS: A cannabis business engaged in at least three (3) of the following commercial cannabis activities: cultivation (on areas less than ten thousand (10,000) square feet), manufacturing (without the use of volatile solvents), distribution, or retail sale, and further described in Section 26001 of the State Business & Professions Code, as may subsequently be amended or recodified. OWNER: Any of the following: A. A person owning in the aggregate equity interests representing twenty (20) percent or more of the voting power of all outstanding equity in the applicant or a permittee; B. The president, chief executive officer, secretary, or treasurer / chief financial officer of a nonprofit applicant or permittee; or C. A member of the board of directors of a nonprofit applicant or permittee. Notwithstanding the above, every applicant and permittee must have at least one individual person designated as an "owner" for the purpose of compliance with this Chapter 14, including the review and evaluation of any commercial cannabis business permit application. PANIC BUTTON: An emergency electronic contact device which allows an employee in the event of an ongoing crime, threat, or other emergency to alert a security guard responsible for providing immediate on -scene assistance. PATIENT or QUALIFIED PATIENT: A person who is entitled to the protections of Section 11362.5 of the State Health & Safety Code, -as may subsequently be amended or recodified, and includes a person issued an identification card issued pursuant to Article 2.5 of Chapter 6 of Division 10 of the State Health & Safety Code, as may subsequently be amended or recodified. PERMITTEE: The holder of a valid, City -issued commercial cannabis business permit. PERSON: An individual, firm, partnership, joint venture, association, corporation, limited liability company, estate, trust, business trust, receiver, syndicate, or any other group or combination acting as a unit and includes the plural as well as the singular number. 0 PERSON WITH AN IDENTIFICATION CARD shall have the meaning given to that term in Section 11362.7 of the State Health & Safety Code, as may subsequently be amended or recodified. PREMISES: The designated structure or structures and land specified in the commercial cannabis business permit application that is owned, leased, or otherwise held under the control of the applicant or permittee where the commercial cannabis activity will be or is conducted. The premises shall be a contiguous area and shall only be occupied by one permittee. SCHOOL: As evidenced by the State Department of Education school directory, a public school instructing children in grades kindergarten through 12, as authorized by the State Department of Education or a private school instructing children in grades kindergarten through 12 that has filed a verification of private school affidavit with the State Department of Education pursuant to Section 33190 of the State Education Code, as may subsequently be amended or recodified, excluding any private school in which education is primarily conducted in a private home. Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, as may subsequently be amended or recodified, this definition of "school" under this Chapter 14 shall override the definition of "school' used in MAUCRSA or Section 11362.768 of the Health & Safety Code, as may subsequently be amended or recodified. STATE: The State of California. STATE LICENSE: A permit or license issued by the State, or one of its departments or divisions, under MAUCRSA and any subsequent State legislation regarding the same to engage in commercial cannabis activity. TESTING LABORATORY: A laboratory, facility, or entity in the City that offers or performs tests of cannabis or cannabis products and that is both of the following: A. Accredited by an accrediting body that is independent from all other persons involved in the cannabis industry in the State; and B. Licensed by the Bureau of Cannabis Control and is owned and operated by a person issued a valid commercial cannabis business permit for laboratory testing from the City. TOPICAL CANNABIS: A cannabis product intended for external application and/or absorption through the skin. A topical cannabis product is not considered a drug as defined by Section 109925 of the State Health & Safety Code, as may subsequently be amended or recodified. VOLATILE SOLVENT: A solvent that is or produces a flammable gas vapor that, when present in the air in sufficient quantities, will create explosive or ignitable mixtures. YOUTH CENTER: (A) any public or private facility that is primarily used to host recreational or social activities for minors such as private youth membership organizations or clubs, social service teenage club facilities or (B) a park, playground, or recreational area specifically designed to be used by children that may have play equipment installed, including public grounds designed for athletic activities such as baseball, softball, soccer, or basketball or any similar facility located on a public or private school grounds, or on City, County, or State parks. Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, as may subsequently be amended or recodified, this definition of "youth center" under this Chapter 14 shall override the definition of "youth center" in MAUCRSA at Section 26001 of the State Business & Professions Code, as may subsequently be amended or recodified. 7 4-14-4: Commercial Cannabis Business Permit Required. A. No person shall operate a cannabis business or engage in commercial cannabis activity within the City unless such business or activity is currently in compliance with all applicable State and local laws, rules, and regulations and the cannabis business has: 1. A valid City business license to conduct such business or activity; 2. A valid commercial cannabis business permit issued by the City pursuant to this Chapter 14 to conduct such business or activity; 3. A valid State license authorizing such business or activity in the City; and 4. A valid certificate of occupancy issued by the City's Building & Safety Division to conduct the commercial cannabis activity at the premises identified in the commercial cannabis business permit. B. A separate commercial cannabis business permit shall be required for each type of commercial cannabis activity listed in Section 4-14-1.0 whether conducted in or engaged on the same premises or on different premises. 4-14-5: Maximum Number and Type of Authorized Cannabis Businesses Permitted. A. There is no maximum number of commercial cannabis business permits for retail -only commercial cannabis activities based within the City. The foregoing notwithstanding, the City Council may establish a maximum number of commercial cannabis business permits for retail -only commercial cannabis activities by resolution. B, The number of commercial cannabis business permits for cultivation sites, manufacturing sites, distributors, testing laboratories, and microbusinesses shall be zero unless subsequently established by resolution of the City Council, in its sole discretion. 4-14-6: Location and Design Requirements for Cannabis Businesses. Pursuant to the authority delegated by the State to the City under Section 26054(b) of the State Business & Professions Code, as may subsequently be amended or recodified, and overriding the location and design requirements contained in Section 26054(b) of the State Business & Professions Code, as may subsequently be amended or recodified, cannabis businesses in the City shall be subject to the following location and design requirements: A. Retailers shall be a permitted use by right subject to this Chapter 14 on property (i) located more than 1,000 feet from any school or day care center; (ii) located more than 600 feet from any youth center; not located along a major arterial; (iii) located within the Multimedia Overlay District; and containing a minimum of 1,750 square feet in gross floor area, as such term is defined in El Segundo Municipal Code Section 15-1-6. B. The location and design requirements for cultivation sites, manufacturing sites, distributors, testing laboratories, and microbusinesses shall be established by ordinance of the City Council, at the sole discretion of the City Council, including the possibility that cultivation sites, manufacturing sites, distributors, testing laboratories, and N. microbusinesses may not be types of commercial cannabis activity permitted to be based within the City pursuant to this Chapter 14 and Title 15 of the City Municipal Code. C. Each cannabis business shall: 1. Be constructed in a manner that prevents odors to surrounding uses, and promotes quality design and construction, and consistency with the surrounding properties. Odors from the cannabis business shall not be detectable from outside the premises and adequate odor control technology shall be utilized; 2. Be provided with adequate electricity, sewage, disposal, water, fire protection, and storm drainage facilities for the intended purpose; and 3. Provide and maintain a neighborhood compatibility plan so the City Manager or designee(s) may find that the cannabis business and its operating characteristics are not detrimental to the public health, safety, convenience, or welfare of persons residing, working, visiting, or recreating in the surrounding neighborhood and will not result in the creation of a nuisance. 4-14-7: Cannabis Retailer Application Procedure. A. Within 60 days following the effective date of this Chapter, the City Manager, pursuant to Section 4-14-29, shall, as a ministerial duty, make available the necessary forms, adopt any necessary application rules for the submission, intake, review, and approval of commercial cannabis business permit applications for retailers. B. The City Manager shall, as a ministerial duty, review retailer applications for completeness and reject any commercial cannabis business permit application that fails to meet the minimum requirements contained in this Subsection B: Payment of an application fee established by resolution of the City Council within 60 days following the effective date of this Chapter to cover all costs incurred by the City in the application process; 2. Sufficient evidence of the legal right to use the proposed property for the proposed use, to include a lease, sublease, purchase agreement, assignment of purchase agreement, or lease or purchase option, in the name of the applicant, which may include nominal consideration and be contingent upon issuance of a commercial cannabis business permit or other approvals. The City shall only consider one applicant per property address or County Assessor's Identification Number. In the event that more than one applicant applies for a commercial cannabis business permit application at a given property address or a given County Assessor's Identification Number, the City Manager shall, as a ministerial duty, only accept the commercial cannabis business permit application with the earliest dated evidence of the legal right to use the proposed property for the proposed use in the name of the applicant; 3. Sufficient evidence to demonstrate that the proposed property complies with location and zoning requirements in Section 4-14-6; 9 4. A completed background check application and receipt for each owner and manager of the applicant pursuant to Section 4-14-211; and 5. The following objective application components described further in the regulations, rules, or standards promulgated under Section 4-14-29: a. Qualifications of the applicant's owners and managers; b. Plans, renderings, and overall location; C. Business and operations plan; d. Security plan; e. Safety plan; Neighborhood compatibility plan; and g. Labor and employment plan. C. Upon receipt of a commercial cannabis business permit application, the City Manager shall direct the Police Chief to conduct background checks in accordance with Section 4- 14-211. Following review and determination that a complete application fulfills the criteria set forth in Subsection B, the City Manager shall, as a ministerial duty, issue a commercial cannabis business permit to the associated applicant. However, the City Manager shall not issue a commercial cannabis business permit to any applicant with an owner or manager that: Provided false or misleading information on the applicant's commercial cannabis business permit application; 2. Has been convicted of (or pled no contest to) "an offense that is substantially related to the qualifications, functions, or duties of the business or profession for which the application is made" as that term is defined in Section 26057(b)(4) of the State Business & Professions Code, as may subsequently be amended or recodified; or 1 Has been sanctioned by a licensing authority or a city, county, or state for unauthorized commercial cannabis activities or has had a license suspended or revoked under MAUCRSA in the three years immediately preceding the date the application was submitted. D. Any decision of the City Manager or City Council under this Section 4-14-7 shall be subject to the administrative appeal provisions of Section 4-14-12. 4-14-8: Application Procedure for Commercial Cannabis Activity other than Retailers. In the event that the City Council, in the sole discretion of the City Council, should amend this Chapter 14 and Title 15 of the City Municipal Code to permit the issuance of commercial cannabis business permits for commercial cannabis activity other than retailers (i.e., cultivation, manufacturing, distributors, testing laboratories, and microbusinesses), the City Council, at the 10 sole discretion of the City Council, shall by resolution make available the necessary forms, adopt any necessary application rules for the submission, intake, review, and approval of commercial cannabis business permit applications for commercial cannabis activity other than retailers up to the maximum number of commercial cannabis business permits authorized pursuant to Section 4-14-5. 4-14-9: Limitations on the City's Liability. To the fullest extent permitted by law, the City shall not assume any liability whatsoever with respect to having issued a commercial cannabis business permit pursuant to this Chapter 14 or otherwise approving the operation of any cannabis business. As a condition to the approval of any commercial cannabis business permit, the applicant shall be required to meet all of the following conditions before they can receive a commercial cannabis business permit: A. Execution of an agreement, in a form approved by the City Attorney, agreeing to indemnify, defend (at applicant's sole cost and expense), and hold the City, and its officers, officials, employees, representatives, and agents, harmless, from any and all claims, losses, damages, injuries, liabilities, or losses which arise out of, or which are in any way related to, the City's issuance of the commercial cannabis business permit, the City's decision to approve the operation of the cannabis business or activity, the process used by the City in making its decision, or the alleged violation of any federal, State, or local laws by the cannabis business or any of its officers, employees, or agents. B. Maintain insurance at coverage limits, and with conditions thereon determined necessary and appropriate from time to time by the City Attorney. C. Defend and indemnify the City for all costs and expenses, including but not limited to attorneys' fees and court costs, that the City may be required to pay as a result of any legal challenge related to the City's approval of the applicant's commercial cannabis business permit or related to the City's approval of a commercial cannabis activity. The City, at its sole discretion, may participate at its own expense in the defense of any such action, but such participation shall neither relieve nor increase any of the obligations imposed on the applicant hereunder. 4-14-10: Commercial Cannabis Business Permit Term. The term of each commercial cannabis business permit shall be indefinite unless suspended or revoked pursuant to Section 4-14-11. 4-14-11: Suspension and Revocation of Commercial Cannabis Business Permits. A. The City Manager may suspend or revoke a commercial cannabis business permit for any material violation of any law and/or any rule, regulation, and/or standard adopted pursuant to this Chapter 14. B. Suspension or revocation of a State license issued by the State or by any of its departments or divisions, corresponding to the commercial cannabis business permit shall immediately result in the suspension of the associated commercial cannabis business permit until the State, or its applicable department or division, reinstates the State license or otherwise lifts such suspension. 11 C. A permittee shall inform the City Manager or designee(s) of any suspension, revocation, or termination of a State license corresponding to its commercial cannabis business permit within two business days of the suspension, revocation, or termination of the State license. 4-14-12: Appeals Regarding Commercial Cannabis Business Permits. A. Within 10 calendar days after the date of a decision of the City Manager to deny issuance of a commercial cannabis business permit or to revoke, suspend, or deny the renewal of an issued commercial cannabis business permit, an aggrieved party may appeal such action by filing a written appeal with the City Clerk setting forth the reasons why the decision was not proper. An appeal shall stay all proceedings in furtherance of the appealed action. B. At the time of filing, the appellant shall pay the appeal fee established by resolution of the City Council. C. Upon receipt of the written appeal, the City Clerk shall set the matter for a hearing before the City Council. The City Council shall hear the matter de novo and conduct the hearing pursuant to the procedures set forth by the City. D. The appeal shall be held within a reasonable time after the filing the appeal, but in no event later than 90 days from the date of such filing. The City shall notify the appellant of the time and location at least 10 days prior to the date of the hearing. E. At the hearing, the appellant may present any information they deem relevant to the decision appealed. The formal rules of evidence and procedure applicable in a court of law shall not apply to the hearing. F. At the conclusion of the hearing the City Council may affirm, reverse, or modify the decision appealed. The decision of the City Council shall be a final administrative decision, subject to judicial review and remedies. 4-14-13: Change in Location; Updated Application Information. A. A permittee may change the business location specified in a commercial cannabis business permit upon submission and approval of a change in location application promulgated, as a ministerial duty, by the City Manager pursuant to regulations adopted under Section 4-14-29 within 180 days following the effective date of this Chapter 14. The permittee shall pay an application fee established by resolution of the City Council to cover all costs incurred by the City in the review and processing of change in location applications. The City Manager shall process such change in location applications as a ministerial duty within 60 days of receipt. B. An applicant or permittee shall notify the City Manager or designee(s) within fifteen (15) calendar days of any material change in the information provided in the applicant or permittee's commercial cannabis business permit application or any change in status of compliance with the provisions of this Chapter 14, including any change in the cannabis business ownership or management. 4-14-14: Transfer of a Commercial Cannabis Business Permit. 12 A. An owner of a commercial cannabis business permit shall not transfer ownership or control of such permit to another person unless and until the permittee and transferee obtain an amendment to the permit from the City Manager stating that the transferee is now an owner of the permittee. A permittee may change the ownership specified in a commercial cannabis business permit upon submission and approval of a change in ownership application promulgated, as a ministerial duty, by the City Manager pursuant to regulations adopted under Section 4-14-29 within 180 days following the effective date of this Chapter 14. The permittee shall pay an application fee established by resolution of the City Council to cover all costs incurred by the City in the review and processing of change in ownership applications. The City Manager shall process such change in ownership applications as a ministerial duty once the City Manager reasonably determines that the transferee passed the background check required for owners and meets all other requirements of this Chapter 14. B. Notwithstanding Subsection A, no commercial cannabis business permit may be transferred when the City Manager has notified the permittee that its commercial cannabis business permit has been or may be suspended or revoked. C. Any attempt to transfer a commercial cannabis business permit either directly or indirectly in violation of this Section 4-14-14 is hereby declared void, and such an unpermitted transfer shall be deemed a ground for revocation of the permit. 4-14-17: Records and Recordkeeping. A. Each cannabis business shall maintain accurate books and records in an electronic format, which detail all revenues and expenses of the business, including, but not limited to, all of its assets and liabilities. On no less than an annual basis (at or before the time of the renewal of a commercial cannabis business permit issued pursuant to this Chapter 14), or at any time upon reasonable request of the City, each cannabis business shall file a sworn statement detailing the number of sales by the cannabis business during the previous 12-month period (or shorter period based upon the timing of the request) detailing sales for each month within such period in question. The statement shall also include gross sales for each month and all applicable taxes paid or due to be paid. On an annual basis, each cannabis business shall submit to the City a financial audit of the business's operations conducted by an independent certified public accountant. Each permittee shall be subject to a regulatory compliance review and financial audit as determined by the City Manager. B. Each cannabis business shall maintain a current register of the names and the contact information (including the name, address, and telephone number) of anyone owning or holding an interest in the cannabis business and, separately, the same contact information of all officers, managers, employees, agents, and volunteers currently employed or otherwise engaged by the cannabis business. The register required by this paragraph shall be provided to the City Manager upon a reasonable request. C. Each cannabis business shall maintain a record of all distributions of cannabis and cannabis products to other cannabis businesses authorized by State law for a period of no less than seven years. D, All cannabis businesses shall maintain an inventory control and reporting system that accurately documents the present location, amounts, and descriptions of all cannabis and 13 cannabis products for all stages of the growing, production, manufacturing, laboratory testing, distribution, sale, delivery, or other commercial cannabis activity processes until purchase or distribution. E. Subject to any applicable restrictions under the Health Insurance Portability & Accountability Act ("HIPAK) regulations, each cannabis business shall grant the City Manager access to the business's books, records, accounts, together with any other data or documents relevant to its permitted commercial cannabis activities, for the purpose of conducting an audit or examination. Books, records, accounts, and any and all relevant data or documents shall be produced no later than five business days after receipt of the City Manager's request for such data, unless otherwise stipulated by the City Manager. The City Manager may require the materials to be submitted in an electronic format that is compatible with the City's software and hardware. 4-14-18: Security Measures. A. A cannabis business shall implement sufficient security measures to deter and prevent the unauthorized entrance into areas containing cannabis or cannabis products and to deter and prevent the theft of cannabis or cannabis products at the cannabis business. Except as may otherwise be determined by the Chief of Police, these security measures shall include, but are not limited to, all of the following: Preventing individuals from remaining on the premises of the cannabis business if they are not engaging in an activity directly related to the permitted operations of the cannabis business. 2. Establishing limited access areas accessible only to authorized cannabis business personnel. 3. Except for live plants, which are being cultivated at a cultivation facility, all cannabis and cannabis products shall be stored in a secured and locked room, safe, or vault. All cannabis and cannabis products, including live plants which are being cultivated, shall be kept in a manner designed to prevent diversion, theft, and loss. 4. Installing 24-hour security surveillance cameras of at least HD -quality to monitor all entrances and exits to and from the premises, all interior spaces within the cannabis business, which are open and accessible to the public, all interior spaces where cannabis, cash or currency, is being stored for any period of time on a regular basis, and all interior spaces where diversion of cannabis could reasonably occur. The cannabis business shall be responsible for ensuring that the security surveillance camera's footage is remotely accessible by the Chief of Police, and that it is compatible with the city's software and hardware. In addition, remote and real-time, live access to the video footage from the cameras shall be provided to the Chief of Police. Video recordings shall be maintained for a minimum of 90 days and shall be made available to the Chief of Police upon request. Video shall be of sufficient quality for effective prosecution of any crime found to have occurred on the site of the cannabis business. 5. Sensors shall be installed to detect entry and exit from all secure areas.. & Panic buttons shall be installed in all cannabis businesses. 14 7. Having a professionally installed, maintained, and monitored alarm system. 8. Any bars installed on the windows or the doors of the cannabis business shall be installed only on the interior of the building. 9. Security personnel shall be on -site 24 hours a day unless the cannabis business has an alternative security program authorized by the Police Chief or designee(s). Security personnel must be licensed by the State Bureau of Security & Investigative Services personnel and shall be subject to the prior review and approval of the Chief of Police, which shall not be unreasonably withheld. 10. Each cannabis business shall install standby generators and have the capability to remain secure during a power outage and shall ensure that all access doors are not solely controlled by an electronic access panel to ensure that locks are not released during a power outage. 11. Additional security measures may be added through the review of a commercial cannabis business permit application. 12. Compliance with the security measures set forth in Chapter 13-20 of this code. B. Each cannabis business shall identify a designated security representative/liaison to the City, who shall be reasonably available to meet with the Chief of Police regarding any security related measures or and operational issues. C. Each cannabis business (including as part of the commercial cannabis business permit application process) shall have a storage and transportation plan and currency management plan, which describes in detail the procedures for safely and securely storing, disposing and transporting all cannabis, cannabis products, and any currency. D. The cannabis business shall cooperate with the City whenever the Chief of Police makes a request, upon reasonable notice to the cannabis business, to inspect or audit the effectiveness of any security plan or of any other requirement of this Chapter 14. E. A cannabis business shall notify the Chief of Police within 24 hours after discovering any of the following: Significant discrepancies identified during inventory. The level of significance shall be determined by the regulations promulgated by the City Manager. 2. Diversion, theft, loss, or any criminal activity involving the cannabis business or any agent or employee of the cannabis business. 3. The loss or unauthorized alteration of records related to cannabis and cannabis products or registering customers or employees and/or agents of the cannabis business. 4. Any other breach of security. 4-14-19: Restriction on Alcohol and Tobacco Sales. 15 No person shall cause or permit the sale, dispensing, or consumption of alcoholic beverages or tobacco on or about the premises of the cannabis business. 4-14-20: Fees and Charges. A. No person may commence or continue any commercial cannabis activity in the City without timely paying in full all fees and charges required for the operation of a commercial cannabis activity. Fees and charges associated with the operation of such activity shall be established by resolution of the City Council which may be amended from time to time. B. All cannabis businesses authorized to operate under this Chapter 14 shall pay all sales, use, business and other applicable taxes, and all license, registration, and other fees required under federal, State, and local law. Each cannabis business shall cooperate with City with respect to any reasonable request to audit the cannabis business' books and records for the purpose of verifying compliance with this Section 4-14-20, including, but not limited to, a verification of the amount of taxes required to be paid during any period. 4-14-21: Generally Applicable Operating Requirements. A. Cannabis businesses may operate only during the hours specified in the commercial cannabis business permit issued by the City and must comply with State law at all times. B. Cannabis shall not be consumed on the premises of any cannabis businesses. C. No cannabis or cannabis products or graphics depicting cannabis or cannabis products shall be visible from the exterior of any property issued a commercial cannabis business permit or on any of the vehicles owned or used as part of the cannabis business. No outdoor storage of cannabis or cannabis products is permitted at any time. D. Each cannabis business shall have in place a point -of -sale or management inventory tracking system to track and report on all aspects of the cannabis business including, but not limited to, such matters as cannabis tracking, inventory data, gross sales (by weight and by sale), and other information which may be deemed necessary by the City. The cannabis business shall ensure that such information is compatible with the City's record - keeping systems. In addition, the system must have the capability to produce historical transactional data for review. Furthermore, any system selected must be approved and authorized by the City Manager prior to being used by a permittee. E, All cannabis and cannabis products sold, distributed, and/or manufactured shall be cultivated, manufactured, and distributed by licensed facilities that maintain operations in full conformance with the State and local regulations. The packaging and labeling of cannabis and cannabis products shall comply at all times with State law. F. There shall not be a physician located in any cannabis business at any time for the purpose of evaluating patients for the issuance of a medicinal cannabis recommendations. G, Each cannabis business shall provide the City Manager with the name, telephone number (both land line and mobile, if available) of an on -site employee or owner to whom emergency notice can be provided at any hour of the day. 16 H. Signage and Notices. In addition to the requirements otherwise set forth in this Section 4-14-21, business identification signage for a cannabis business shall conform to the requirements of the City Municipal Code, including, but not limited to, seeking the issuance of a City sign permit. 2. No signs placed on the premises of a cannabis business shall obstruct any entrance or exit to the building or any window. 3. Each entrance to a cannabis business shall be visibly posted with a clear and legible notice indicating that smoking, ingesting, or otherwise consuming cannabis on the premises, or in the areas adjacent to the premises, is prohibited. 4. The entrance to the cannabis business shall be clearly and legibly posted with a notice that no person under the age of 21 years of age is permitted to enter upon the premises of the cannabis business, other than as lawful customers permitted under State law in the case of retailers. 5. No cannabis business shall advertise by having a person holding a sign and advertising the business to passersby, whether such person is on the premises of the cannabis business or elsewhere including, but not limited to, the public right- of-way. Other than as lawful customers permitted under State law in the case of retailers, individuals under the age of 21 years shall not be allowed on the premises of a cannabis business and shall not be allowed to serve as a driver for a cannabis business. It shall be unlawful and a violation of this Chapter 14 for any person to employ any person at a cannabis business who is not at least 21 years of age. J. Odor control devices and techniques shall be incorporated in all cannabis businesses to ensure that odors from cannabis are not detectable off -site. Cannabis businesses shall provide a sufficient odor absorbing ventilation and exhaust system so that odor generated inside the cannabis business that is distinctive to its operation is not detected outside of the facility, anywhere on adjacent property or public rights -of -way, on or about the exterior or interior common area walkways, hallways, breezeways, foyers, lobby areas, or any other areas available for use by common tenants or the visiting public, or within any other unit located inside the same building as the cannabis business. As such, cannabis businesses must install and maintain the following equipment, or any other equipment which the City Manager determines is a more effective odor control method or technology: An exhaust air filtration system with odor control that prevents internal odors from being emitted externally; and 2. An air system that creates negative air pressure between the cannabis business's interior and exterior, so that the odors generated inside the cannabis business are not detectable on the outside of the commercial cannabis business. K. The original copy of the commercial cannabis business permit issued by the City pursuant to this Chapter 14 and the City issued business license shall be posted inside the cannabis business in a location readily visible to the public. 17 La. Pursuant to Sections 11105(b)(11) and 13300(b)(11) of the State Penal Code, which authorizes City authorities to access State and local summary criminal history information for employment, licensing, or certification purposes; and authorizes access to federal level criminal history information by transmitting fingerprint images and related information to the Department of Justice to be transmitted to the Federal Bureau of Investigation, every person listed as an owner, manager, supervisor, employee, or volunteer of the cannabis business must submit fingerprints and other information deemed necessary by the Chief of Police for a background check by the City Police Department. Pursuant to Sections 11105(b)(11) and 13300(b)(11) of the State Penal Code, which requires that there be a requirement or exclusion from employment, licensing, or certification based on specific criminal conduct on the part of the subject of the record, no person shall be issued a commercial cannabis business permit unless they have first cleared the background check, as determined by the Chief of Police, as required by this Chapter 14. A fee for the cost of the background investigation, which shall be the actual cost to the City to conduct the background investigation as it deems necessary and appropriate, shall be paid at the time the application for a commercial cannabis business permit is submitted. K The cannabis business shall prohibit loitering by persons outside the facility both on the premises and within 50 feet of the premises. N. It shall be unlawful for a cannabis business to discriminate in any manner or take adverse action against any employee in retaliation for exercising rights protected under this Chapter 14 or City or State law. These rights include, but are not limited to (i) the right to file a complaint or inform any person about any party's alleged noncompliance with this Chapter 14 or City or State law and (ii) the right to inform any person of his or her potential rights under this this Chapter 14 or City or State law and to assist him or her in asserting such rights. Protections under this this Chapter 14 or City or State law shall apply to any employee who mistakenly, but in good faith, alleges noncompliance with this this Chapter 14 or City or State law. Taking adverse action against an employee within 90 days of the employee's exercise of rights protected under this this Chapter 14 or City or State law shall raise a rebuttable presumption of having done so in retaliation for the exercise of such rights. 4-14-22: Additional Operational Requirements in General. The City Manager may, pursuant to Section 4-14-29, develop additional cannabis business operational requirements or regulations for all authorized commercial cannabis activities as are determined to be necessary to protect the public health, safety, and welfare. 4-14-23: Additional Operating Requirements for Cultivation Sites. If the City Council should amend this Chapter 14 and Title 15 of the City Municipal Code to permit the issuance of commercial cannabis business permits for the commercial cannabis activity of cultivation within the City, the City Council shall amend this Section to adopt operating requirements for cultivation within the City. 4-14-24: Additional Operating Requirements for Manufacturing Sites. If the City Council should amend this Chapter 14 and Title 15 of the City Municipal Code to permit the issuance of commercial cannabis business permits for the commercial cannabis activity of 18 manufacturing within the City, the City Council shall amend this Section to adopt operating requirements for manufacturing within the City. 4-14-25: Additional Operating Requirements for Testing Laboratories. If the City Council should amend this Chapter 14 and Title 15 of the City Municipal Code to permit the issuance of commercial cannabis business permits for the commercial cannabis activity of testing laboratories within the City, the City Council shall amend this Section to adopt operating requirements for testing laboratories within the City. 4-14-26: Additional Operating Requirements for Distributors. If the City Council should amend this Chapter 14 and Title 15 of the City Municipal Code to permit the issuance of commercial cannabis business permits for distributors based within the City, the City Council shall amend this Section to adopt operating requirements for distributors based within the City. 4-14-27: Additional Operating Requirements for Retailers. A. Retailers and the operation thereof shall comply with State law at all times. B. Prior to dispensing medicinal cannabis or medicinal cannabis products to a qualified patient, a retailer shall verify the age and all necessary documentation of each customer to ensure the customer is not under the age of eighteen (18) years and obtain verification from the recommending physician that the person requesting medicinal cannabis or medicinal cannabis products is a qualified patient, and shall maintain a copy of the physician recommendation or identification card as described in Sections 11362.71 through 11362.77 of State Health & Safety Code, as may be amended from time to time, on site for period of not less than seven (7) years. C. Prior to dispensing cannabis or cannabis products to an adult -use customer, a retailer shall verify the age and all necessary documentation of each customer to ensure the customer is not under the age of twenty-one (21) years. D. All restroom facilities shall remain locked and under the control of managers onsite, E. A retailer shall notify customers (verbally or by written agreement) and by posting of a notice or notices conspicuously in at least 15-point type within the permitted premises that state as follows: "The sale or diversion of cannabis or cannabis products without a license issued by the City of El Segundo is a violation of State law and the El Segundo Municipal Code." 2. "Secondary sale, barter, or distribution of cannabis or cannabis products purchased from a permittee is a crime and can lead to arrest." 3. "Customers must not loiter in or near these premises and may not consume cannabis or cannabis products in the vicinity of this business or in any place not lawfully permitted. These premises and vicinity are monitored to ensure compliance." 19 4. "WARNING: The use of cannabis or cannabis products may impair a person's ability to drive a motor vehicle or operate heavy machinery." 5. "CALIFORNIA PROP. 65 WARNING: Smoking of cannabis and cannabis -derived products will expose you and those in your immediate vicinity to cannabis smoke. Cannabis smoke is known by the State of California to cause cancer and reproductive harm." 4-14-28: Additional Operating Requirements for Delivery and Microbusinesses. A. Delivery shall comply with State law at all times. B. Security plans developed pursuant to this Chapter 14 shall include provisions relating to vehicle security and the protection of employees and product during loading and in transit. C. A retailer shall facilitate the delivery of cannabis or cannabis products with a technology platform owned by or licensed to the delivery -only retailer that uses point -of -sale technology to track and database technology to record and store the following information for each transaction involving the exchange of cannabis or cannabis products between the retailer and customer: The identity of the individual dispensing cannabis or cannabis products on behalf of the permittee; 2. The identity of the customer receiving cannabis or cannabis products from the permittee; 3. The type and quantity of cannabis or cannabis products dispensed and received; 4. The gross receipts charged by the permittee and received by the individual dispensing cannabis or cannabis products on behalf of the permittee for the cannabis or cannabis products dispensed and received; and 5. The location or address where the sale or retail sale took place or closed. D, A permittee shall maintain a database and provide a list of the individuals and vehicles authorized to conduct delivery, and a copy of the valid State driver's license issued to the driver of any such vehicle on behalf of the retailer to the Chief of Police. E. Individuals making deliveries of cannabis or cannabis products on behalf of the retailer shall maintain a physical copy of the delivery request (and invoice) and shall make it available upon the request of agents or employees of the City requesting documentation. F. During delivery, a copy of the permittee's commercial cannabis business permit and State license shall be in the vehicle at all times, and the driver shall make it available upon the request of agents or employees of the City requesting documentation. G, A retailer shall only permit or allow delivery of cannabis or cannabis products in a vehicle that is (i) insured at or above the legal requirement in the State; (ii) capable of securing (locking) the cannabis or cannabis products during transportation; (iii) capable of being 20 temperature controlled if perishable cannabis or cannabis products is being transported; and (iv) does not display advertising or symbols visible from the exterior of the vehicle that suggest the vehicle is used for cannabis delivery or affiliated with a retailer. H. A retailer shall facilitate deliveries with a technology platform owned by or licensed to the retailer that uses global positioning system technology to track, and database technology to record and store the following information: The time that the individual conducting delivery on behalf of the retailer departed the licensed premises. 2. The time that the individual conducting delivery on behalf of the retailer completed delivery to the customer. 3. The time that the individual conducting delivery on behalf of the retailer returned to the licensed premises. 4. The route the individual conducting delivery on behalf of the retailer traveled between departing and returning to the licensed premises to conduct delivery. & For each individual delivery transaction, the identity of the individual conducting deliveries on behalf of the retailer. 6, For each individual delivery transaction, the vehicle used to conduct delivery on behalf of the retailer. 7, For each individual delivery transaction, the identity of the customer receiving cannabis or cannabis products from the retailer. & For each individual delivery transaction, the type and quantity of cannabis or cannabis products dispensed and received. 9. For each individual delivery transaction, the gross receipts charged by the retailer and received by the individual conducting deliveries on behalf of the retailer for the cannabis or cannabis products dispensed and received. The individual making deliveries on behalf of the retailer shall personally verify for each individual delivery transaction the identity of the customer receiving cannabis or cannabis products from the retailer and (a) for medicinal cannabis or medicinal cannabis products to a qualified patient, the age and all necessary documentation of each customer to ensure the customer is not under the age of 18 years and obtain verification from the recommending physician that the person requesting medicinal cannabis or medicinal cannabis products is a qualified patient, and shall maintain a copy of the physician recommendation or identification card as described in Sections 11362.71 through 11362.77 of State Health & Safety Code, as may be amended from time to time, on site for period of not less than seven years or (b) for cannabis or cannabis products to an adult - use customer, age and all necessary documentation of each customer to ensure the customer is not under the age of 21 years. Microbusinesses will be subject to the requirements applicable each relevant commercial cannabis activity. 21 4-14-29: Promulgation of Regulations, Standards, and Other Legal Duties. A. Consistently with stated requirements of this Chapter 14 (and in particular not to repeal or constructively repeal this Chapter 14), in addition to any regulations adopted under State law, the City Manager is authorized to establish any additional rules, regulations, and standards governing the issuance, denial or renewal of commercial cannabis business permits, the ongoing operation of cannabis businesses, and the City's oversight, or concerning any other subject determined to be necessary to carry out the purposes of this Chapter 14. B. Such regulations shall be published on the City's website. C, Regulations promulgated by the City Manager shall become effective upon date of publication. Cannabis businesses shall be required to comply with all State and local laws and regulations, including but not limited to any rules, regulations or standards adopted by the City Manager. 4-14-30: Community Relations. A. Each cannabis business shall provide the name, telephone number, and email address of a community relations contact to whom notice of problems associated with the cannabis business can be provided. Each cannabis business shall also provide the above information to all businesses and residences, in the City, located within 150 feet of the cannabis business. Such community relations contact shall respond to any complaints within 48 hours of receipt of such complaints. B. Cannabis businesses to which a commercial cannabis business permit is issued pursuant to this Chapter 14 shall develop and make available to youth organizations and educational institutions a public education plan that outlines the risks of youth addiction to cannabis, and that identifies resources available to youth related to drugs and drug addiction. 4-14-31: Fees Deemed Debt to City. The amount of any fee, cost, or charge imposed pursuant to this Chapter 14 shall be deemed a debt to the City that is recoverable via authorized processes as set forth in the City Municipal Code or available through any court of competent jurisdiction. 4-14-32: Permittee, Owner, and Property Owner Responsible for Violations. A. Each permittee and each owner and each manager of the permittee (and each individual owner and each individual manager of an owner or manager of the permittee) shall be responsible for all violations of the laws of the State or of the regulations and/or the ordinances of the City occurring within the City or in or about the premises of the cannabis business, if committed by the permittee or any employee or agent of the permittee and whether or not said violations occur within the permittee, owner, or manager's presence. B. No person may engage in any commercial cannabis activity within the City unless the person is in compliance with the requirements of this Chapter 14. 22 C. It shall be unlawful to rent, lease, or otherwise permit any commercial cannabis activity at any location, structure, or vehicle in the City by a person (1) that does not have a valid commercial cannabis business permit issued by the City; (2) that does not have a valid State license; (3) that does not have any other applicable approvals, including, but not limited to, a building permit and City business license; or (4) that is not currently in compliance with all applicable State and local laws and regulations pertaining to the commercial cannabis activity. Property owners shall have strict liability for any commercial cannabis activity at any location, structure, or vehicle in the City by a person (1) that does not have a valid commercial cannabis business permit issued by the City or (2) that does not have a valid State license. 4-14-33: Inspection and Enforcement. A. The City Manager, Chief of Police, or designee(s) charged with enforcing the provisions of the City Municipal Code, or any provision thereof, may enter the location of a cannabis business at any time, without notice, and inspect the location of any cannabis business as well as any recordings and records required to be maintained pursuant to this Chapter 14 or under applicable provisions of State law. B. It is unlawful for any person having responsibility over the operation of a cannabis business, to impede, obstruct, interfere with, or otherwise not to allow, the City to conduct an inspection, review or copy records, recordings, or other documents required to be maintained by a cannabis business under this Chapter 14 or under State or local law. It is also unlawful for a person to conceal, destroy, deface, damage, or falsify any records, recordings or other documents required to be maintained by a cannabis business under this Chapter 14 or under State or local law. C. The City Manager, Chief of Police, or designee(s) charged with enforcing the provisions of this Chapter 14 may enter the location of a cannabis business at any time during the hours of operation and without notice to obtain samples of the cannabis to test for public safety purposes. Any samples obtained by the City shall be logged, recorded, and maintained in accordance with the City Police Department standards for evidence. 4-14-34: Concurrent Regulation with State. It is the stated intent of this Chapter 14 to regulate commercial cannabis activity in the City concurrently with the State. 4-14-35: Violations Declared a Public Nuisance. Each and every material violation of the provisions of this Chapter 14 is hereby deemed unlawful and a public nuisance. 4-14-36: Each Violation a Separate Offense. Each and every violation of this Chapter 14 shall constitute a separate violation and shall be subject to all remedies and enforcement measures authorized by the City Municipal Code. Additionally, as a nuisance per se, any material violation of this Chapter 14 shall be subject to injunctive relief, any commercial cannabis business permit issued pursuant to this Chapter 14 being deemed null and void, disgorgement, and payment to the City of any monies unlawfully obtained, costs of abatement, costs of investigation, attorney's fees, and any other relief or 23 remedy available at law or in equity. The City may also pursue any and all remedies and actions available and applicable under State and local laws for any violations committed by the cannabis business or persons related to, or associated with, the commercial cannabis activity. Additionally, when there is determined to be an imminent threat to public health, safety or welfare, the City Manager, Chief of Police, or designee(s), may take immediate action to temporarily suspend a commercial cannabis business permit issued by the City, pending a public hearing before the City Council. 4-14-37: Criminal Penalties. Each and every material violation of the provisions of this Chapter 14 may be prosecuted as a misdemeanor and upon conviction be subject to a fine not to exceed $1,000 or imprisonment in the County jail for a period of not more than six months, or by both such fine and imprisonment. Each day a material violation is committed or permitted to continue shall constitute a separate offense. 4-14-38: Remedies Cumulative and Not Exclusive. The remedies provided herein are not to be construed as exclusive remedies. The City is authorized to pursue any proceedings or remedies provided by law. SECTION 5. Chapter 13B (Cannabis -Related Uses and Activities) of Title 15 (Zoning Regulations) of the City Municipal Code is hereby repealed in its entirety and amended to read as follows: Chapter 13B: PERSONAL CANNABIS CULTIVATION 15-1313-1: Definitions. The definition of "cannabis" and related terms for the purpose of this Chapter 13B are contained in Section 4-14-3 of the City Municipal Code. 15-13B-2: Prohibited Uses and Activities. The establishment or operation of any commercial cannabis activity, cannabis -related activity, cannabis storage facility, or cannabis business, including any business licensed by the State or other government entity pursuant to MAURSCA, as it may be amended from time to time, shall comply with Chapter 14 of Title 4 of the City Municipal Code. 15-1313-3: Cultivation of Cannabis for Personal Use. A. Outdoor Cultivation: The outdoor cultivation of cannabis is prohibited in the City regardless of purpose. B. Indoor Cultivation: Not more than six (6) plants may be cultivated, planted, harvested, dried, processed, or possessed at one time by persons 21 years of age or older when conducted within a single private residence and in a manner consistent with section 11362.2 of the State Health and Safety Code and any other applicable regulations. 15-1313-4: Interpretation. 24 The intent of this Chapter 13B is to prohibit the personal cultivation of cannabis, whether medical or recreational in nature, to the maximum extent allowed under State law. Nothing in this Chapter 13B should be interpreted as allowing behavior otherwise prohibited by State law and nothing in this Chapter 13B should be interpreted as prohibiting conduct that the City is expressly preempted from prohibiting under State law. SECTION 6. Section 15-1-6 (Definitions) of Chapter 1 (Title; Interpretation; Definitions) of Title 15 (Zoning Regulations) of the City Municipal Code is hereby amended by repealing the following (with the definitions of such Section 15-1-6 appropriately reordered in sequence): GAf the plas t; he seedg t. the -resin, (Vhe irud+ d-- a^. r•eaw+waFa+,u^—,". of the plant,"its "s „ annabis i dsk " , 'k:8'- iM wro,ies-"i—ed. 1.. wwMwh N,fw°"t" D q s ��i:IpG 4 &3 e�Wh C V� I r " � of the . t (exi� �y p efilized " a I er it'_1++e °". a131°`" .r r"'.vt•Pan "indI AIDS of PfeiatP w" rves i '' , anufa -. e d � , ; zing, --er " ing, OF n �bisor Gannab� -. N',: wry st ty ' he la i-gf&Ma4nivei, ss bis- C 'N V T=I I1-FTC-fa 'ility V�here I i --Iota v 6 ma',fring faisil ' , e . bNl eF+ Ga lhrI p e e+..�, ire A at enables Gust amefs-tG-aFFangei fae t�ae i 44ensed-retai4e f Raf — fae' " r �I eitheF Safi ... r . N , an N d ad i-ate , pfe"__ between •er&ie�o 25 CANNA�N6--EST " I kT A man a s�� "All oa-Rnabis-�isspePcsary- eFwise make manufacturing4acAities O GaA -but not GA % es 1-reby t. bra ediWr-4egfed1e GAN RSLATED TA foie;. r ",sae a sfoAti i M t t st Ashment a3 a F�i l Gan' or-a%�-�6 "4 Er �; provider. aGa •a �. ° it es- 31e�na##-""t+eg„ gssi-$ net GaaAA } ns tw,4"e-(2) yea �04 ingle pFWate-r-esidenw and in i • F the s, m f- � , a uds aie i :ANh� ae� r, 1 A-fe inky w ,a S Y fad: re�,T-ibwtie ,i , , 1%F�Ijwvwdatie., eFy, tea SECTION 7. Chapter 15-713 (Multimedia Overlay (MMO) District) of Title 15 (Zoning) of the El Segundo Municipal Code is amended to include a new Section 15-76-11 which will read as follows: 15-7113-11: Commercial Cannabis Retailer. Notwithstanding anything in this Chapter 15-713 to the contrary, cannabis retailers meeting the requirements of Chapter 4-14 (Commercial Cannabis Activity) of this Code are permitted in the MMO District as such use complements the creative, independent artistry foundational to the MMO District. SECTION 8. 'ENVIRONMENTAL REVIEW. The actions contemplated herein have been reviewed pursuant to the California Environmental Quality Act (Public Resources Code §§ 21000, et seq., "CEQA") and the regulations promulgated thereunder (14 Cal. Code of Regulations §§15000, et seq., the "CEQA Guidelines"). Based upon that review, 26 the actions contemplated therein are exempt from CEQA, pursuant to: CEQA Guidelines § 15061(b)(3), the "common sense" exemption"; categorical exemption Class 8 (Actions by Regulatory Agencies for the Protection of the Environment), per CEQA Guidelines § 15308, without qualifying for any exceptions to the exemptions, as set forth in CEQA Guidelines § 15300.2; and CEQA Guidelines § 15783 (Projects Consistent with Zoning). SECTION 9. Conflicting Measures. The People of the City find and declare that the provisions of the Measure relating to the regulation of commercial cannabis activity in the City may conflict with one or more provisions of other initiative measures. It is the intent of the People that if the Measure receives a greater number of affirmative votes than a conflicting measure at the same election, this Measure shall prevail in its entirety over a conflicting measure. SECTION 10.. Severability. If any provision, section, paragraph, sentence, phrase, or word of the Measure is rendered or declared invalid, illegal, or unconstitutional by any final action in a court of competent jurisdiction or by reason or any preemptive legislation, such unconstitutionality illegality or invalidity shall only affect such provision, section, paragraph, sentence, phrase, or word and shall not affect or impair any remaining provisions, sections, paragraphs, sentences, phrases, or words, or the application of the Measure to any other person or circumstance, and to that end, the provisions hereof are severable. It is hereby declared to be the intention of the People of the City that that the Measure would have been adopted had such unconstitutional illegal or invalid provision, section, paragraph, sentence, phrase, or word not been included herein. SECTION 11. Liberal Construction. The Measure is an exercise of the initiative power of the People of the City to provide for safe and regulated access to cannabis and cannabis products, and shall be liberally construed to effectuate that purpose. SECTION 12. Legal Defense, If approved by a simple majority of voters, and thereafter challenged in court of competent jurisdiction, the City shall defend the Measure in such court of competent jurisdiction. The People of the City by approving this Measure by a simple majority of voter hereby declare that the proponent(s) of the Measure have a direct and personal stake in defending the Measure from constitutional or statutory challenges to the Measure's validity or implementation. In the event the City fails to defend the Measure, or the City fails to appeal an adverse judgment against this Measure, in whole or in part, in any court of competent jurisdiction, the Measure's proponent(s) shall be entitled to assert his, her, or their direct personal stake by defending the Measure's validity and implementation in any court of competent jurisdiction and shall be empowered by the People through this Measure to act as agents of the People of the City, and the City shall indemnify the proponent(s) for reasonable attorneys' fees. SECTION 13. Effective Date. Pursuant to Elections Code Section 9217, the Measure shall be in full force and effect upon the tenth day following certification by the City Council of the election returns indicating passage of the Measure by a majority of the voters casting votes on the Measure. 27