PREPARED BY: KIERON SLAUGHTER DATE OF MEETING: 04/21/2025
SUBJECT:
TITLE
CONSIDER ADOPTING RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN PABLO (1) APPROVING AND AUTHORIZING THE ISSUANCE OF A REQUEST FOR QUALIFICATIONS (RFQ) FOR CANNABIS OPERATOR PERMITS FOR RETAIL SALES AND (2) ADOPTING PROCEDURES GOVERNING APPEALS OF DECISIONS RELATED TO THE “ELIGIBILITY LIST” TO BE ESTABLISHED IN CONNECTION WITH THE RFQ PROCESS
CEQA: This proposed action is not a project as defined by CEQA. CEQA Guidelines Section 15378(b)(5) states that “project” does not include organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.
Label
CITY MANAGER RECOMMENDATION
Recommendation
Adopt Resolution
Body
Compliance statements
FY 2025-27 Council Priority Workplan Compliance Statements:
Authorizing a Request for Qualifications (RFQ) is the next step in accomplishing a major policy goal contained in the FY 2025-27 City Council Priority Workplan of Focus on Economic Development and Fiscal Diversification, Priority #405 - Explore and Sustain New Revenue Enhancements to the City’s General Fund, and Priority #410 - Explore and Research Cannabis Commercial Uses and Impacts, effective April 7, 2025.
CEQA Compliance Statement The RFQ is exempt from the California Environmental Quality Act in accordance with CEQA Guidelines Section 15378(B)(5) because it can be seen with certainty that there is no potential for causing a significant effect on the environment because the project solely involves an administrative activity and does not authorize any construction activities, and specifically requires a discretionary conditional use permit process and accompanying environmental review in the event that any retail business is actually proposed as a result of an eligibility list.
BACKGROUND
On March 3, 2025, the City Council adopted Ordinance 2025-001, amending the San Pablo Municipal Code (Title 17 - Zoning Ordinance) Chapter 17.32, Section 17.32.030; Chapter 17.34, Section 17.34.030; Chapter 17.36, Section 17.36.030, Chapter 17.62, Section 17.62.130, and Chapter 17.70, Section 17.79.040 to revise existing regulations pertaining to the personal cultivation of cannabis and to establish land use standards applicable to certain permitted commercial cannabis businesses in the City of San Pablo.
RETAIL CANNABIS REGULATORY FRAMEWORK AND SELECTION PROCESS
As stated in the March 3, 2025 agenda report, in response to City Council priority workplan policies to explore commercial cannabis uses to enhance general fund revenues for San Pablo and the passage of Measure M, staff have created a framework for allowing up to three (3) retail cannabis businesses to operate within the City of San Pablo.
The proposed framework includes multiple layers of review for prospective retail cannabis businesses including a Request for Qualifications (RFQ), issued by the City to recruit and evaluate potential operators, an Operator Permit and Conditional Use Permit. The RFQ is intended to be an independent separate, one-time process to be administered by the Economic Development & Housing division. The goal is to solicit operators that can demonstrate that they will be able to meet the requirements of Ordinance 2025-001.
An RFQ selection committee will evaluate and present a ranked list of eligible respondents to the City Council for approval. Up to three (3) top-ranked respondents selected by the City Council will be eligible to apply for up to three (3) Cannabis Operator Permits. The Zoning Administrator separately issues these Operator Permits, with decisions appealable to the City Manager. Once applicants have secured an Operator Permit, they must then also obtain a Conditional Use Permit, which requires approval from the Planning Commission at a public hearing and will be appealable to City Council. Once an operator has acquired both the Operator and Conditional Use permits, as well as all other necessary state or local permits and licenses, they would be able to begin operations in the City.
REQUEST FOR QUALIFICATIONS RANKING PROCESS
The review committee will consist of City and Executive Leadership Group (ELG) staff. Qualifications will be evaluated and proposals will be scored based upon the criteria and maximum point values shown below:
1. Business Experience & Qualifications 20 points
2. Location Suitability & Compliance 20 points
3. Business & Operating Plan 10 points
4. Community Benefits 10 points
5. Financial Stability & Resources 20 points
6. Proposal Clarity & Implementation 20 points
7. Local Hire/Ownership Plans (Optional but incentivized) 20 points
The selection committee will rank proposals and may invite the top-ranking applicants to an interview.
The proposed resolution also includes procedures governing any appeals of decisions related to the RFQ selection process and “Eligibility List”.
FISCAL IMPACT
All proposed actions and are expected to generate new and future business license tax revenue for the City of San Pablo.
ATTACHMENTS:
Att A. Resolution
Exh A. Request for Qualifications (RFQ) Cannabis Operator Permits for Retail Sales
Exh B. Request for Qualifications (RFQ) Cannabis Operator Permits Eligibility List Appeal Procedures