Palm Springs Approves New Fee Regulations for Cannabis Business Violations

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Palm Springs City Council on Thursday unanimously approved a new schedule of city fines that can be levied on cannabis-related businesses that violate city regulations that apply to them.

In 2019, Palm Springs passed a series of revised regulations for cannabis companies such as pharmacies and manufacturing operations, largely due to local residents’ concerns about the effects of the smells these companies can produce.

These regulations outlined several violations of the Code and listed the maximum administrative penalties the city could impose on companies that commit them. Maximum fines have been set for the first, second and third violations within a year. Companies that commit a second violation are also subject to a possible six month suspension of their business license, while companies that commit a third violation can revoke their licenses.

Green Dragon's cannabis dispensary and lounge in downtown Palm Springs, July 21, 2020.

However, the rules did not provide guidance on how to determine the level of fines for certain infringements in excess of those ceilings. City Manager Justin Clifton’s memo to the council says the new fine plan aims to provide more clarity by differentiating between types of violations and setting fines for each.

The new schedule differentiates between minor, medium and serious violations. The minor violation schedule is $ 500 for a first violation within a year, $ 1,000 for a second, and $ 5,000 for a third. The schedule for moderate violations is $ 2,500 for a first violation within a year, $ 7,500 for a second, and $ 10,000 for a third. Serious violations are $ 5,000 for a first, $ 10,000 for a second, and $ 25,000 for a third. The total maximum penalties remain the same and are now applied for third violations at each level.

Clifton said in the memo that city officials were proposing a strict fee schedule rather than one with amount ranges for the fines to “ensure even enforcement and clarity for businesses.” [permit holders] and staff for enforcing city laws. “

In the event of violations falling into more than one category, the highest of the possible fines specified in the schedule will be imposed.

A city official who presented the schedule said the city found such administrative quotes “very effective” in enforcing short-term vacation rental rules.

The city’s law enforcement department is responsible for enforcing cannabis regulations and collecting administrative fines. On June 10, the City Council approved the appointment of two law enforcement officials assigned solely to enforce and regulate the Cannabis Act.

The only comments on the ordinance came from councilors Dennis Woods and Geoff Kors, who asked if the violations could be appealed to the city’s administrative hearing committee. When told it was possible, Woods asked if the fines could also be challenged and was told that it was not possible, just the violations themselves.

Here’s how some of the violations are categorized in the schedule:

  • Selling cannabis goods without a label: Seriously
  • Failure to notify the city within 48 hours of criminal convictions or civil judgments against a business license holder or suspected theft or loss of business inventory: Serious
  • Failure to take sufficient security measures to restrict access to only authorized personnel and prevent the intrusion and theft of cannabis products: Serious
  • No use of alternative fuel vehicles in a fleet to transport cannabis: Moderate
  • California Labor Law Failure: Moderate
  • Failure to illuminate entrances and windows and not comply with city light standards: Minor

The new schedule also maintains the same penalties for odor-specific violations outlined in the revised regulations.

These penalties are as follows: Companies that exceed the allowable odor threshold but are not otherwise out of control with their submitted odor control plan will receive a warning and seven days to correct the problems before they are then forced to cease operations by then.

Companies that exceed the threshold and also fail to adhere to their odor control plan will be fined $ 10,000 and given 30 days to fix the issues and comply. An additional $ 10,000 fine will then be imposed for each month that the permit holder fails to address the odor issues. If a license holder receives three notifications, the license is automatically revoked.

Companies that violate approved odor limits and engage in illicit cannabis activities will be fined $ 25,000 and may revoke all of their permits.

You can reach Paul on Twitter at @albaniburgiop and by email at PAlbaniBurgio@gannett.com.