Slide from a cannabis-workshop presentation shared by city staff at the Aug. 13 Signal Hill City Council meeting, indicating areas of the city that state law excludes from cannabis-related commercial activity should the city decide to allow it.
During its Aug. 13 meeting, the Signal Hill City Council conducted a third cannabis workshop in the city following two community meetings in May and June. It agreed to continue research into costs and revenues and survey the community on cannabis attitudes and needs.
The council also approved a new adult-daycare facility-permit, a contract to clean up trash at a local residence and a police-department reorganization that creates a homeless-liaison officer position.
Cannabis workshop
The council conducted its cannabis workshop beginning with a presentation by city staff on industry information compiled by the city’s Proposition 64 Subcommittee over the past 18 months.
The city conducted two previous workshops in May and June, each attended by about 60 people, City Manager Charlie Honeycutt said.
Ben Jones from the city attorney’s office began the presentation by giving an overview of federal and state cannabis regulations since 1970, when the drug became illegal under the federal Controlled Substance Act.
Jones recounted how some states since then, including California, allowed medical use of marijuana and, more recently, adult-recreational use. California state law SB 94 consolidated licensing of medical and adult-recreational uses of marijuana in June 2017, he said.
SB 94 identified five primary types of marijuana licenses: cultivation, manufacturing cannabis products, lab testing, distribution, and retailing, Jones said. It also preserved the city’s ability to control cannabis activity through a dual state-and-local licensing scheme.
“That means local authorities can prohibit some or all different types of marijuana businesses and land uses and can require a permit and impose additional or more stringent regulations on those businesses,” Jones said.
Honeycutt then shared statistics about licenses issued by the state so far, noting that there have been nearly 15 cultivation licenses for every one retail license issued.
He also discussed problematic cultivation taxing for non-medical marijuana use.
“State and local taxes is an active topic of discussion,” Honeycutt said. “The black market continues to thrive because state and local taxes make legal cannabis too expensive.”
Honeycutt added that the current state legislative session have been active in that regard, with 46 bills to date designed to assist the legal cannabis marketplace by lowering tax rates, but most have failed to get support.
Legislators are still evaluating SB 51 to provide banking and credit services for cannabis businesses, he said.
In terms of public safety, Honeycutt said the California Police Chiefs Association (CPCA) met with officials from the state of Colorado, where the medical and recreational uses of cannabis have been legal for longer, in order to learn best practices.
“They were advised not to ‘chase the money’ because […] the cost of regulation enforcement and addressing cannabis-related social issues were consuming all of their cannabis tax revenues,” Honeycutt said.
He said police are also concerned because there is currently no standard for cannabis consumptive impairment like there is for alcohol impairment, adding that UC San Diego is developing a roadside test it’s hoping to complete soon.
In Los Angeles County, 17 of 88 cities allow some form of cannabis use in varying degrees, Honeycutt said. Cannabis businesses are banned by the county itself, along with cities like Compton and Signal Hill, while some cities, like Santa Monica, allow medical commercial use only and some, such as Long Beach, allow all uses.
The City of Long Beach received 244 permit applications for a variety of commercial activities as of March 2019, issuing 33 licenses so far, Honeycutt said. The city’s 2019 fiscal-year expense budget related to cannabis regulation is about $3.5 million, he said.
Long Beach’s cannabis tax rates range from 6% to 8% depending on the type of business and whether its use is medical or adult-recreational. Cultivation tax is $12 per square foot, Honeycutt said.
Long Beach’s estimated revenues will be $4.1 million this year, an increase from $1.6 million last year as more licensed businesses get up and running, Honeycutt said.
So far, Long Beach has 32 retail dispensaries, many located around Signal Hill, though not all are open yet, Honeycutt said. Therefore, the council adopted a “wait-and-learn” approach to study and allow more time for a subcommittee to gather information.
Honeycutt ended his part of the presentation by noting that in March 2017, two-thirds of Signal Hill voters opposed Measure F, the only qualifying Signal Hill ballot measure so far regarding cannabis businesses.
Scott Charney, Signal Hill’s community-development manager, said that the city continues to prohibit all cannabis uses, though state law overrides local policy in allowing marijuana delivery and cultivation for personal use with a permit.
“We have issued no permits for that to date,” he added.
If the city decided to allow cannabis businesses, state law would restrict their locations according to buffer zones around residential areas and sensitive settings such as schools, Charney said.
“There’s an area in the center of town– essentially the Willow Street and Spring Street corridors from either side of town– that would be able to be considered,” he said.
Hannah Shin-Heydorn, deputy city-manager, described how the subcommittee – consisting of herself, Charney, Honeycutt, Councilmember Edward Wilson and Mayor Lori Woods– conducted research.
“The subcommittee sought out resources within the cannabis industry and worked with industry experts to gather information, data, lessons learned and best practices,” Shin-Heydorn said, adding that the subcommittee also toured eight actual facilities and talked to their owners and operators.
She also shared community responses from the first two community workshops, one on May 22 (as reported in the Signal Tribune’s May 24 issue) and the second on June 18 as part of a Planning Commission meeting.
She said those responses include: support for the city’s wait-and-learn approach; concern that cannabis-related businesses could attract crime and asking for data on that; concern that cannabis is a cash-only business and the transportation and storage of that cash; concern about whether Signal Hill residents can still consume cannabis products in the city, which Shin-Heydorn said they can; compassion and support for medicinal uses and dispensaries; and concern about whether Signal Hill could generate enough revenue to offset cost of administration and enforcement if it allowed cannabis businesses.
The council agreed on a next step of contracting with a financial analyst to review operating and staffing costs the city would incur if it allowed cannabis businesses and the revenues it would need to get a positive outcome.
It also agreed that the city should conduct a community survey on attitudes and needs regarding the cannabis industry.
Woods added a third step that the council agreed with of finding a city the size of Signal Hill that issues cannabis-related business licenses and analyzing its costs and revenues.
During council discussion, most supported continuing research. However, Wilson argued that while he thought it was important to form the Prop 64 subcommittee, he believed the city should move forward with licensing cannabis businesses now. Before the workshop began, Wilson had asked the city attorney whether his investment in a Long Beach cannabis business would cause a conflict of interest in the council’s discussion. City Attorney Dave Aleshire said that it wouldn’t, unless that business it was directly involved in the discussion.
Wilson noted that two-thirds of Signal Hill voters had supported Proposition 64 itself and suggested that though Measure F didn’t pass locally, it didn’t mean residents didn’t want cannabis businesses.
He also suggested that the council’s attitude to marijuana was rooted in old notions, comparing it to alcohol, which is legal.
“We grew up thinking it was bad,” he said. “Twenty to 30 years from now, all the kids growing up now will think it’s normal. […] Our responsibility is, how do we implement it.”
Wilson compared cannabis businesses to car dealerships, restaurants, department stores and grocery stores, which the city pursues despite equivalent businesses existing in Long Beach.
Wilson also said that while an illegal market for marijuana may continue, the city can minimize it.
“If there’s a cost, it’s already happening,” Wilson said. “This is just another plant that people will consume. And they’re consuming it now.”
Wilson asked Signal Hill Police Chief Christopher Nunley about crime data related to cannabis businesses but Nunley reported that there is no empirical data regarding crime statistics for cannabis storefronts except for a 2016 study using data from 2012 to 2013 showing increased property crimes adjacent to cannabis shops, though not directly next to them.
Honeycutt added that such data is limited since the industry is fairly new.
“What we hear from the operators is that […] there’s not a [large] problem,” he said.
During public comment, Steve Strichart, a Signal Hill resident, said that the city doesn’t need cannabis businesses because of the plethora of Long Beach dispensaries.
“You pretty much can’t leave Signal Hill without running into one of these places,” he said. “They’re all over the place, and there’s going to be more.”
But Farida Benderradji, a Los Angeles realtor, said she is familiar with the cannabis industry and some of her clients wanted to invite council members to visit their businesses.
“You would see how professional it is, how well-paid everybody is and what an uplift it is to the community,” she said. “Cannabis is not the drugs of the past. […] It’s a business opportunity for the city and for a lot of people who are looking for employment.”
Gene Rotondo, an industry consultant who had helped the subcommittee set up facility tours, said that if the city chooses to allow such businesses, it should hire someone from the industry to help.
“Financially, this can be worked out so that the city can, in fact, make money,” he said.
Rotondo also criticized Long Beach city planners for unnecessarily delaying the implementation of cannabis businesses.
“It’s a matter of efficiencies,” he said. “If they really want to get the revenue in, get these places open. They’re safer than any restaurant you could go to.”
City Clerk Carmen Brooks spoke in support of CBD (Cannabidiol) products for medicinal and health purposes, noting that marketers promote it as a nutritional supplement, including for seniors.
“What I don’t see close to Signal Hill are those [businesses] that promote the health benefits,” she said. “I hope to have access to CBD in Signal Hill.”
Honeycutt noted that CBD products are available in the Signal Hill Mother’s Market grocery store.
In further discussion, council members advocated continued study and assessment, but Wilson said that if the city waits too long, it will miss out on business opportunities.
“Given the proper tax structure, businesses will want to locate […] in Signal Hill,” he said. “This is just a business like any other business.”
Vice Mayor Robert Copeland favored the city’s deliberate approach but suggested it could benefit by acting soon.
“Hopefully it’s quick enough that the city can capitalize on some of the revenues before they get dried up or before the market is saturated,” he said.
Police Reorganization
In other business, the council agreed to reorganize the Signal Hill Police Department (SHPD) to remove a vacant police-officer position, reclassify an officer position to sergeant and create two special-assignment positions: an administrative sergeant and a homeless-liaison officer.
Sylvia Soong, the city’s human-resources manager, said that the special-assignment positions will pay 5.4% over normal salary but the city will still save $46,000 to $59,000 per year because of the eliminated position.
In answer to a question by Wilson, Nunley said that the reorganization will not impact the number of officers on patrol.
Adult daycare
After conducting a public hearing, the council agreed to a conditional-use permit (CUP) allowing a new daycare facility at 695 E. 27th St. for adults with intellectual and developmental disabilities.
Assistant Planner Ryan Agbayani said that the Planning Commission supported issuing the permit after conducting two public hearings and receiving no objection.
The facility consists of a single-story office building with onsite parking in the city’s commercial-general zone, which allows such a use. The property, owned by Bill Goldsmith, also includes an industrial building.
The daycare provider, Dungarvin, has operated in California since 1997 with two existing sites in Long Beach and Norwalk, Agbayani said. The program is licensed by the state and provides individual services to clients to promote their long-term growth, including community integration, communication, socialization and domestic daily living.
The facility will install new ADA (Americans with Disabilities Act)-compliant access ramps as well as modify the space to include offices, a computer lab, a music studio and a library.
Trash nuisance
The council agreed that the city should clean up the outside of a residential property at 3309 Lemon Ave. due to unabated trash nuisance.
Honeycutt said that the city has reached out to the property owners for over a year in response to complaints.
“This is a result of a property owner failing to comply with multiple notices to clean up the property,” he said. “Now the property appears to be abandoned.”
Planning Manager Colleen Doan said that though the owner-occupant has removed trash temporarily, the nuisance conditions always returned.
“On occasion, conditions improved, but were never resolved and eventually worsened,” she said. “The property owner has become nonresponsive and has failed to remedy the nuisances. Therefore, city abatement seems the best solution.”
She said the city received six bids from abatement contractors with the lowest qualifying bid at $3,700 by Eco Bear Biohazard Cleaning Company. The total estimated cost of the abatement, including legal fees, past-due water charges, staff time, postage and the abatement contractor, is about $14,000, she said.
The council also approved a property lien to recover those costs if they are not paid by the owner in a timely fashion.
Mercedes lease
Finally, the council approved leasing 1.45 acres of land at 2690 Cherry Ave. and 2689 St. Louis Ave. to the Mercedes-Benz auto dealership in Signal Hill for $3,150 per month for about eight months.
Elise McCaleb, redevelopment and economic-development manager, said the dealership will store cars on the site while it completes a $4-million renovation, including expanding its showroom and adding guest amenities, an infrastructure for electric vehicles and a larger reception area.
She said it expects to complete those renovations by spring 2020.
Voting innovations
Aaron Nevarez, public affairs manager with the Los Angeles County Registrar-Recorder/County Clerk’s office, presented on his organization’s Voting Solutions for All People (VSAP) project designed to encourage voter participation.
“We don’t talk about it as a voting system,” he said. “We do talk about it as a new voting experience because […] it’s a comprehensive reimagining.”
Nevarez said the new elements include a modern tally system, electronic poll books, an electronic interactive sample-ballot option, a new ballot-marking device and a new vote-by-mail experience.
Though the county implemented a new vote-by-mail feature last November, it will pay for postage and add drop-off locations throughout the county beginning with the next election in March 2020, Nevarez said.
In addition, the county will extend voting to an 11-day period instead of just one day, expand voting centers to thousands of locations across the county, and allow people to choose where they want to vote.
“We’re looking to expand convenience for our voters, [to] ensure they have every opportunity to cast their ballot […] at a location and time of their choosing,” Nevarez said.
A new electronic system allows for this flexibility, he said. The electronic ballot-marking device is user-tested and allows voting regardless of language, disability or technological ability.
“It’s not electronic voting,” he said. “It’s a digital interface but still produces a human-readable paper ballot for auditability and security.”
At voting centers, clerks will use an electronic poll book rather than a paper roster, allowing voters to check in and vote at any location in the county.
The clerk will give each voter a paper ballot with a QR (quick-response) code in case the person has previously made their decisions on an electronic sample ballot.
“You can either […] cast your choices from the very beginning or scan the QR code for an expedited voting experience,” Nevarez said.
He added that the electronic sample ballot may be especially time-saving next year.
“Potentially, the March and November elections in 2020 […] could be a very long ballot,” Nevarez said. “You cast a paper ballot that you can review and verify into the same device and still get your ‘I voted’ sticker, which we know our voters really like.”
The county hopes to have 1,000 voting centers open by March 2020, Nevarez said, and will conduct a mock-election test on Sept. 28 and 29 at 50 voting centers.
“We hope to activate these sites with food trucks and other exciting engagement with the public,” he said. “It really is an opportunity for members of the public to […] experience what a vote center is like and also get to test the new equipment.”
About 10 demonstrations centers at any given time will remain open from October through January so residents can check them out.
The new system will also expedite processing ballots and publishing results, Nevarez said.
“There’s no guarantee […] that we’ll be able to publish the final results any sooner,” he said. “But one of the benefits of this new system is that it virtually eliminates provisional ballots, which are the most difficult for an election administrative office to process.”
Council members expressed concern that familiar voting locations shouldn’t change and asked about a demo center in Signal Hill, which Nevarez said is yet to be determined. They also expressed appreciation.
“This makes me really excited to vote,” Copeland said.
New library
During new business, Councilmember Keir Jones expressed appreciation for the new Signal Hill Public Library that had its grand opening Aug. 10.
“It’s been a lot of hard work for everyone for 20, 25 years,” he said. “It is truly state-of-the-art and it’s going to provide a place for our city for many, many years and it continues to show that Signal Hill is a leader in making sure that we have great facilities for our residents.”
Woods said she estimated that 400 visitors attended the grand opening and 300 visitors went to the library on Monday this week, the library’s first day of operation.
Councilmember Tina Hansen thanked state and local officials who attended, and city staff who worked on it, especially Honeycutt, Community Services Director Ali Mancini and Public Works Director Kelli Tunnicliff.
“They showed so much grit and determination in yanking this project over the finish line,” Hansen said. “I hope everybody feels as proud as I do.”
The meeting was adjourned in memory of long-time Signal Hill resident Marjorie Gromme.
The next Signal Hill City Council meeting will take place Tuesday, Aug. 27 at 7pm in the council chamber at 2175 Cherry Ave.
