The city of Watsonville is looking to make its first update to its retail cannabis business ordinance in four years, after complaints from business owners who say the ordinances are more strict than those imposed by the state of California— and are cumbersome and time-consuming.
At a city council meeting on Oct. 10, Aaron Newsom, co-founder and Chief Operations Officer of Santa Cruz Veterans Alliance, spoke about the challenges of operating under Watsonville’s current regulations. Newsom has one of Watsonville’s three retail licenses and says the proposed changes would help an industry that is already hurting.
“The industry has gone through a lot of hard times in the last few years and it has made doing business very difficult,” he says. “I think some of these changes could make it a little more doable to do business and make this work in the city.”
There are 16 proposed tweaks to the current ordinance, which include allowing a new establishment, opening more of the city to new businesses and waiving some distance restrictions.
Currently, residential setback from retail cannabis shops is 250 feet and from schools is 600 feet.
“If we’re going to look at allowing dispensaries in other commercial zones, then we might also need to look at either waivers or changing the distance requirements for a retail facility,” says Planning Director Suzi Merriam.
Currently, retail cannabis is allowed in Industrial Park General Industrial and Visitor Commercial zoning districts.
That, along with a rule limiting signage to one 20 square-foot sign, has left the existing retail cannabis shops hidden in industrial regions of the city with little hope of attracting customers. Creme de Canna, for example, is down a 500-foot driveway. One proposal therefore asks the city to allow larger signs.
Other proposals include increasing store hours, relaxing requirements for annual business license renewal and requiring background checks for only store owners.
Currently, businesses must complete a new application package and submit a business plan every year.
“It’s a pretty big lift to review every year, so we’re wondering if there’s a way we can look at modifying this and paring it down to the information that we’re really interested in,” Merriam says.
The item before the council was only for discussion and no action was taken. Merriam told the board she was “taking the temperature” of the board for items that will be brought back for in-depth discussion at future meetings, likely sometime in 2024.
Currently, Watsonville has three retail businesses. That’s compared to two in Capitola and five in the city of Santa Cruz.
The current regulations also make it hard to compete with the still-active black market, Merriam said.
The definition of who is considered an owner also confuses things. Under the ordinance, even someone who gives $100 to a retail business is considered an owner and must undergo a weeks-long background check, Merriam says.
Changing that to the state threshold of 20% ownership would ease that process, she says.
Of all the proposals, only the requests to decriminalize psychoactive plants and allow flavored vaporizer products garnered a “hard no” from the council. The rest will come back for further discussion.
Councilwoman Vanessa Quiroz-Carter says she would support bringing all the proposals back, and said that loosening some of the restrictions could benefit the city.
“What’s in place by the state is already incredibly strict, and I think we’re shooting ourselves in the foot if we’re rejecting businesses that want to be here,” she says.
Councilman Jimmy Dutra says that increasing the number of dispensaries, saying it could hurt already struggling businesses.
“I think adding another one would not probably be good for any bus because it sounds like they are not doing so great,” he says.
Councilwoman Kristal Salcido says that the community and other city departments should be involved in the process for future discussions.
“The more information the better,” she says. “We can’t just have one presentation on this. We need more input from more departments than just planning. A lot of these requests are shifting policy.
“All of these things have meaningful public safety implications, and we’ve heard nothing from public safety today,” Salcido adds.