BELLFLOWER — While the South Gate City Council stiffened the city’s ordinance prohibiting all marijuana operations Feb. 27, the Bellflower City Council Feb. 26 changed its law in hopes of encouraging 10 permit holders to begin operations and start generating needed tax revenue.
South Gate Community Development Director Joe Perez said the law prohibiting all marijuana operations in the city was approved in December. The Feb. 27 ordinance dealt with land use to make sure all cannabis operations would be prohibited in all zones.
Bellflower’s ordinance, approved last year, already requires a conditional use permit (CUP) to assure a marijuana operation is appropriate for the site. But none of the 10 permit holders, approved in a marathon session Dec. 18, have begun operations even though all but one has paid the $28,500 vetting fee for a background check, security plans and operational and business plans, a city spokesperson said.
In a written report to the council, City Manager Jeffrey L. Stewart said at least one permit holder has complained that the council’s decision to prohibit medical marijuana dispensaries to also sell recreational marijuana has altered its business plan, apparently concerning finances.
The council also rejected a staff proposal Feb. 12 that permit holders be allowed to transfer their permit to someone who meets the requirements and is willing to start operations. However, officials did agree that permit holders could transfer to other sites (to be approved by council) with only a $3,000 transfer fee and not having to pay the $28,500 vetting fee, which they already paid.
However, Bellflower may have to open the field to newcomers because one of the provisions approved by a 4-0 vote Feb. 26 gives all permit holders 30 days from that date to begin operations.
Another new provision to ease the rules would allow cultivation or processing operations to take place 500 feet from a church or school instead of 1,000 feet, if the work is done in an enclosed building and generates little traffic.
The changes, billed as an “emergency ordinance,” were approved 4-0 Feb. 26 with Councilman Juan Garza recusing himself, saying his employer has some business contacts with those in the marijuana field. Final reading on the changes is set for the council session March 12.
“Surprisingly, several of the businesses that successfully obtained a medical cannabis business permit and a CUP have not implemented the uses authorized by the City Council,” Stewart said in his staff report. “At the February 12 meeting, the council noted that the purpose of allowing cannabis-related businesses in the city was to replace tax revenues, about $1.5million year, that would otherwise be lost with the expiring utility use tax in 2018. If businesses failed to implement proposed cannabis businesses, the city would lose out on that tax revenue.
Stewart was referring to the two percent hike to the city’s utility tax that was approved by voters in 2012 with the understanding that the increase would end in five years.
Perez, in a written report to the South Gate Council Feb. 27, said the purpose of the second ordinance recommended by the Planning Commission, was to “amend the South Gate Zoning Code to prohibit all marijuana commercial activity and prohibit all outdoor marijuana cultivation.”
The prohibition covers commercial industrial zones and residential neighborhood zones and prohibits all commercial marijuana activities and outdoor marijuana cultivation.
“Adoption of the proposed ordinance will result in the city foregoing revenue from local sales and other local excise taxes (e.g. business tax) on commercial activities related to the production, processing, testing, delivery and sale of marijuana in South Gate. The amount of revenue is dependent upon the excise tax and the number and type of commercial marijuana uses allowed.
“Regulatory fees intended to recover the city’s costs to oversee commercial marijuana activities will also not be collected since the proposed ordinance prohibits all marijuana commercial activity in South Gate,” Perez said.
“The anti-marijuana laws supports the goal of protecting strong and sustainable neighborhoods.” Perez added. “The potential establishment of the commercial cultivation, processing, distribution, testing and sale of marijuana in the city without an express ban on such activities poses a threat to public health, safety and welfare in the city due to the negative impacts of such activities.
Artesia, Cerritos, Norwalk and Santa Fe Springs have also banned all commercial marijuana operations. Downey, which promotes its medical and clinical areas, would allow testing and evaluation of marijuana. Maywood has approved permits for three medical marijuana operations, including at least one dispensary, all in operation.
Huntington Park will allow up to three medical marijuana dispensaries. To date just one, established eight months ago, is in operation and has not caused any problems, Police Chief Cosme Lozano said.
Whittier is reportedly considering allowing one medical marijuana dispensary in an industrial area. One such facility operated there several years ago and caused no major crime problems, police said.
However, it was closed when its owner ran into trouble in another city, officials said.