Effective July 1, 2021 the Department of Cannabis Regulation (DCR) put into effect two new Ordinances (187094 and 187095) amending Article 4 and Article 5 of the Los Angeles Municipal Code regulating commercial cannabis activity in the City of Los Angeles. Below are key highlights of the amendments.
Cultivation and non-storefront retail application Types 1A, 1C, 2A, 4, 5A, and 9 shall be limited to verified Social Equity Applicants only until January 1, 2025.
The Social Equity Applicant or Licensee shall hold the highest officer position such as Chief Executive Officer (CEO) unless another natural person is appointed under mutual agreement of the parties. Equity Share by the Social Equity Applicant is unconditional and shall not go to another person(s) under any circumstance other than death or incapacity. The successor shall be an individual of the Social Equity Applicant’s choosing.
Primary Personnel may be subjected to a Livescan or other review of criminal history. Primary Personnel convicted of a civil judgment concerning illegal Commercial Cannabis Activity for a period of 5 years from the date of judgement shall be prohibited from applying for or holding a Temporary Approval or License. Additionally, a Business Premises that was the site of padlocking under Section 104.15.1 for a period of 5 years from the date of padlocking is deemed ineligible.
Sensitive Use Restrictions
For new Applicants, if a Sensitive Use is established after the Verification Date, the applicant will be considered compliant with zone, distance, and Sensitive Use restrictions. The Verification Date means the “first business day of the calendar quarter beginning February 1, May 1, August 1, or November 1, which immediately precedes the Application Date. The Application Date is the date the Applicant has paid all Pre-Application Review or Modification Request Form Review fees.
The definition of Public Park has been expanded to include any property in the City of Los Angeles zoned Open Space (OS) that is maintained or operated as a parks and recreation facility, including bicycle trails, equestrian trails, walking trails, nature trails, park land/lawn areas, children’s play areas, child care facilities, picnic facilities, and athletic fields used for park and recreation purposes.
Existing EMMDs shall continue operating and not be subject to the zone, distance and Sensitive Use restrictions until after December 31, 2025.
Business Premises Relocations
Applicants who submit a request for a Business Premises Relocation shall submit the following at minimum to the DCR:
Applicants deemed eligible under Phase 3 Round 1 Retail processing shall submit one relocation request prior to December 31, 2021 and will not be subject to the Business Premises Relocation Fee. The Modification Request Review fee ($542) still applies.
Applicants who submit a request to modify the ownership structure of the Temporary Approval or License shall submit the following at minimum to the DCR:
Legal Entity Name Change:
Applicants who submit a request to modify the legal entity name of the Temporary Approval or License shall comply with the following:
The DCR may require a new application to be submitted if it determines that the Application, Temporary Approval, or License has been sold, leased, lent, or otherwise transferred to another Person and shall deem the existing Application abandoned.
Applicants may submit a request to expand their Business Premises to no more than 50% of the existing floor area or 2,500 square feet, whichever is less.
Jenna Rompel (Margolin & Lawrence)