Imperial Beach last week approved the annual fee its first and only cannabis company must pay to open a shop.
March and Ash, the pharmacy and delivery company that opened at 740 Palm Ave. in February. City officials said they would have to pay $ 24,000 to cover audits and inspections under the City of South County’s new fee system.
Councilors voted 4-0, in the absence of Mayor Serge Dedina, to approve the permit fee, which “aims to ensure the city is 100 percent reimbursed for staff time, consultancy fees and other expenses” required to regulate local industry are, read a city staff inspection report.
Approved fees include $ 8,000 for annual tax audits; nearly $ 4,000 for legal assistance updating local cannabis regulations; $ 3,000 for the San Diego County Sheriff’s Public Safety to conduct compliance checks on minors and respond to service requests; and an additional $ 3,000 for a semi-annual on-site inspection, according to a cost analysis by the city’s HdL Companies consulting firm.
“This fee proposed by them (HdL companies) is the same as in other cities,” said Reyna Ayala, the city’s planner.
In South County, Chula Vista has yet to set an annual inspection fee, but the initial compliance check fee is $ 16,570. National City, which recently completed its cannabis company application process, will shortly begin collecting an application fee. In North County, Vista charges an annual permit fee of $ 28,000 and Oceanside charges one of the lowest in the state at $ 8,850.
The city also plans to monitor the local cannabis industry and collect data “to consider relevant factors” such as complaints, criminal activity, licensing status of the cannabis business and responses to public submissions. The data collection, which would not be paid for with government fees, will be used if and when the council is considering licensing a second cannabis retailer.
Imperial Beach approved its cannabis ordinance in June 2018 to allow a recreational marijuana dispenser in the city. Applicants were required to pay a $ 10,000 filing fee, show they had $ 300,000 in cash, have a detailed safety plan, pass background checks, have at least one manager with prior experience in the marijuana industry, and find a location that is not within 300 feet away is a school, park, or daycare center.
The city received seven applications for a single cannabis business license about two years ago. March and Ash “were considered the only qualified applicants after this process,” said Tyler Foltz, director of community development for Imperial Beach.
Some members of the public warned the city to hold developers accountable, especially when it comes to the marketing of cannabis products and the potential appeal to children.
Breton Peace, co-owner and general counsel to March and Ash, admitted the public’s concern, saying, “We understand this starts at the front end with marketing.”
Council members expressed their support in working with March and Ash, who have offices in San Diego, Vista, Mission and Imperial Valley, and most recently in Chula Vista.
“We’re dealing with people who know the cause, who want to be good neighbors, who want to do good business in our small town,” said Councilor Jack Fisher. “And I think they strive not only to be good partners for us, but also to continue to listen … what we have to say.”
Also last week, the city council unanimously approved the first reading of a development agreement with March and Ash.
The agreement, which sets out the terms of the company’s operations, calls for the company to pay a monthly percentage of no less than 7 percent of its income, a figure tied to Chula Vista cannabis retail tax. They’ll go up if Chula Vista raises its taxes, Foltz said. The developer would also pay Imperial Beach a one-time, non-refundable amount of $ 1.5 million. The fees paid to the city would fund drug education programs, recreation and improvements to the city’s facilities, Foltz said.
The city council has yet to do a second reading of the development agreement. It would go into effect 30 days later, should councilors accept it.