Cannabis Land Use Regulation In the Warm California Sun: Santa Cruz!

Known for its beaches and beach culture, its boardwalk, and all things organic, Santa Cruz County is also a rich example of medical cannabis land use provisions and changes. In addition to its close proximity to San Jose, its similarity in provisions and increased restrictions provide some valuable lessons that can be applied locally. Santa Cruz finds itself struggling with issues of land use on two major fronts: in regulating dispensaries, and, most recently, in the use of its land for cultivation.

On March 9th, 2010, Santa Cruz enacted the ordinance that regulates the use of land by medical cannabis dispensaries within the city limits. Still used today, this ordinance uses regulations that are restrictive at times and relatively permissive at others. As with any other land use ordinance, the first aspect that must be addressed are the zones in which businesses can operate. Section 24.12.1300.1 for example, allows for dispensaries to be located in C-C (Community Commercial), C-T (Thoroughfare Commercial), and I-G (General Industrial) upon receiving a special use permit. This places medical dispensaries in the same category as other businesses like medical or dental offices, plant nurseries and greenhouses, and eating or drinking establishments.

Within these general zoning restrictions, the city then describes more particularized land use regulations. While the state sets the standard distance for medical cannabis dispensaries from places like residences at 1000 feet, Santa Cruz is much more relaxed. It only requires a dispensary demonstrate that it is not at “an intensity of use that is incompatible with the nearby residential use” in the event the dispensary is located within fifty feet of a residence. Unfortunately, the provision does not objectively define “intensity”, or what would be too intense for local residents. The provision also sensibly requires a demonstration of adequate security to insure the safety of the surrounding residences. Also more relaxed than the state recommended guidelines (yet sensible) is requiring the distance from sensitive areas like schools and rehab centers to be six hundred feet instead of one thousand feet. While these are a few provisions that stand out in Santa Cruz’s ordinance, it continues with a standard list of provisions about things like signage and loitering. Interestingly enough, a permit system governs the dispensaries that are to follow this long list of provisions. As of 2010 in this ordinance, the city stated that they would only grant two permits. By the time 2013 to the present comes around,

San Jose is not the only municipality in the South Bay that has recently made some changes to their local land use ordinance. Santa Cruz has also recently adopted a new land use ordinance, chapter 7.126, which they enacted to amend their original local ordinance, chapter 7.124. The ordinance itself recognizes that “the county’s unique geographic and climatic conditions, which includes dense forested areas receiving substantial precipitation, are favorable to cannabis cultivation.” So why is it that Santa Cruz, like the city of San Jose, is choosing to tighten their regulations? Is it because increased regulation is an improvement in itself? Or is there some optimal level of regulation that they hope to achieve? If so, where does San Jose find itself on this spectrum with its new ordinance? To answer these questions, let’s take a look at Santa Cruz’s ordinance.

Santa Cruz made its first amendment to the 2010 medical cannabis land use ordinance in December of 2013 by enacting local ordinance chapter 7.124. The county derived its power to enact this chapter in the same way other municipalities were able to (and by following my series of posts, we can see that San Jose is no exception). As I explained in my prior post, on May 6th, 2013, the California Supreme Court decided a landmark case in the area of local regulation. City of Riverside v. Inland Empire Patients Health and Wellness Center, Inc. (hereafter referred to as “Inland Empire”). The decision by the California Supreme Court interpreted Article XI, Section 7 of the California Constitution as saying that the rights afforded to Californians under proposition 215 and SB 420 do not pre-empt local regulatory measures. Article XI, Section 7 of the California Constitution provides local municipalities the policing power to use land as they see fit to maintain public health, safety, and welfare. To achieve these goals, the Inland Empire decision granted local municipalities the right to enact their own regulations up to, and including, an outright ban on medical marijuana within their jurisdiction.

With the Inland Empire decision, Santa Cruz passed chapter 7.124. Chapter 7.124 passed in reaction to the tight regulations set out in the 2010 which bred more transgression than compliance. This ordinance identified “demands placed on law enforcement and administrative resources; neighborhood disruption; the exposure of children to medical marijuana; drug sales to minors and adults; fraud in issuing, obtaining or using medical marijuana recommendations; robberies, burglaries, assaults, drug trafficking and other violent crimes” as unintended social ills that Santa Cruz was experiencing after the enactment of the 2010 regulation. To solve these problems, Santa Cruz seems to have loosened some restrictions by emphasizing the rational approach seen in the 2010 ordinance which looked at intensity of use when dispensaries were within fifty feet of residences. While standing firm on their two permit limit and even setting out a ban on medical cannabis dispensaries, 7.124 set out a number of additional provisions, which, if followed, will allow a dispensary to operate with immunity from the ban. While many of its tenets remain intact, this chapter was only in use for three months before the city felt the need to pass new amendments as chapter 7.126.

Chapter 7.126 was enacted on February 25th, 2014. It did make some minor changes like changing a dispensary’s potential of hours of operations from being able to open at six a.m. instead of seven a.m., and close at nine p.m. instead of seven p.m. It also enacted the increasingly popular provision of requiring patients to be a minimum of twenty-one years old instead of the previous age limit of eighteen. The most significant change, however, was in the way the city rezoned land use in regards to cultivation. Grouping cultivators as a medical cannabis business with the dispensaries (as opposed to some agricultural enterprise), cannabis cultivation businesses were rezoned to “SU (Special Use), TP (Timber Production), CA (Commercial Agriculture), A (Agriculture), AP (Agriculture Preserve) or RA (Residential Agriculture)”. The city chose these zones as ones that define the urban area. While this can be seen as reasonably reducing social ills like exposure to children, neighborhood disruption, and the enforcement that goes along with these ills, the provision also sets out some very difficult provisions to follow once the cultivators have relocated to the city’s outskirts. The grows can be no more than ninety nine plants, but must be located on a parcel no less than one acre, and in residential agriculture zones, no less than five acres.  There are various canopy size requirements depending on the acreage of the growing parcel. Additionally, cultivation businesses must then adhere to Title 16, Environmental and Resource Protection, which then sets out even more regulations. My hope in mentioning this sample of the long list of provisions is that it impresses upon the reader that this original drafting of 7.126 represents a certain degree of regulation. This degree, however, proved to be too great a strain on the legal market.

On March 24th of 2015, Santa Cruz revisited and revised chapter 7.126. Tipping their hat to the list of provisions from their previous version of 7.126, the county admits, “the creation of rules contains an inherent assumption that people will follow them. Our experience has been to the contrary when it comes to cannabis cultivation.” The county goes on to cite the known existence of 84 grows at the time the previous chapter was passed, and how that number rose to 139 at the time of this revision. It also cites specific provisions like those requiring certification of cannabis cultivation businesses and how “virtually no one is following those rules, and it has led to questions concerning their import and effectiveness.” Additionally, they notice that having rezoned cultivation businesses to non-urban areas has resulted in environmental damage. Given the proven impracticality of allowing cannabis cultivation businesses in non-urban zones, and zoning restrictions prohibiting their operation in urban areas, the city enacted a ban on the cultivation of cannabis other than personal grows associated with a qualified patient.

The degree to which Santa Cruz was regulating was ineffective. What this county, and others enacting similar to greater degrees of regulation, should consider is the implications of a ban. Creating regulations is like drawing a circle and determining who falls within it, and who is operating outside of it. Santa Cruz increased its regulations on a highly active market by passing chapter 7.124. Naturally, increased regulations will make the circle smaller, creating more who fall outside of it. When people transgress the regulations, it requires the county’s enforcement power. In an attempt to clean up those outside the circle, Santa Cruz responded by passing chapter 7.126, increasing regulations, and making the circle even smaller. With these increased regulations, Santa Cruz found even more operating outside the chapter’s limits, and an increased need to use funds for enforcement. Finding this degree of transgression unacceptable, Santa Cruz responded with a ban. A ban, arguably, is not only a further increase in regulation, it is an absolute. Thus, if the increased regulations led to increased transgression which increased the need for enforcement at a level the county finds unacceptable, then implementing a ban is the wrong direction for the county. Following the trend of their recent history of increased regulation, a ban could create the need for levels of enforcement beyond those which they have already deemed unacceptable. Perhaps the best option for Santa Cruz—and other similarly situated counties—would be to swing in the opposite direction and create looser regulations that businesses could realistically follow without creating attendant social harms.

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