Watsonville City Council considers cannabis changes – Santa Cruz Sentinel

WATSONVILLE — Seven years after the Watsonville City Council added a chapter to regulate the cultivation and production of medical cannabis in the city, the city council will consider changes to the cannabis equity program at its meeting Tuesday.

According to a staff report from Community Development Director Suzi Merriam and Associate Planner Ivan Carmona, a new chapter was added to the municipal code in 2017 containing regulations for the cultivation and production of medical cannabis in the city, and a year later the ban on recreational cannabis stores was lifted . In 2019, the council passed an ordinance establishing a cannabis equity program “to provide those negatively impacted by the War on Drugs an opportunity to enter the legal cannabis market,” Merriam and Carmona wrote.

However, the city did not conduct a cannabis equity assessment until 2022, when the council voted to amend the municipal code to align with the recommendations outlined in the assessment prepared by the California Center for Rural Policy at Cal Poly Humboldt, which the City allowed application for state funding for cannabis equity grants, Merriam and Carmona wrote.

After the assessment was completed and Watsonville became eligible for state grants, the city received a $767,436 grant to support businesses eligible for the Cannabis Equity Program in the 2022-23 fiscal year. A total of $690,699 was distributed to local cannabis businesses.

However, the Cannabis Equity Program grant changed at the state level in 2023 as more cities developed their own programs, making the grant more competitive. Although Merriam and Carmona had conducted an equity assessment the previous year, Merriam and Carmona wrote that the state had identified two deficiencies in the Watsonville program. One was a subsection of municipal code that violated the equal protection clauses of the U.S. and California constitutions, which legally guarantee equal treatment for people of all genders. The subsection reportedly violated these clauses and allowed companies that were at least 50% owned by women to be eligible for the program.

The other inadequacy cited was the restriction on reserving a cannabis equity permit for each business category, which the California Governor’s Office of Business and Economic Development deemed too restrictive and inconsistent with the program’s goals.

In response, staff changed code language to remove eligibility criteria for women-owned businesses and shutdown approvals for cannabis equity companies. Definitions referring to City permits as licensees or licensees have also been changed to refer to them as permits and permittees, consistent with industry terminology.

Finally, certain sections of the code were amended to align with equity programs in cities such as Sacaramento and San Jose, both of which have equity programs that were competitive for state cannabis equity grants.

“Their programs do not differentiate between the application processes for equity and non-equity permits, nor do they limit the number of permits reserved for equity firms,” Merriam and Carmona wrote. “They will provide financing and technical assistance to their eligible investees as needed.”

The proposed changes were presented to the Planning Commission at its Oct. 1 meeting. The commission voted 4-0 to recommend that the council approve these changes. Commissioners Lucy Rojas and Brando Sencion were absent and the District 4 seat remains vacant.

In addition, the council will consider density premiums and preliminary maps for a 13-lot subdivision on a vacant Habitat for Humanity property on Airport Road and will also attend a study session on limits on transit facilities in the township code.

The council will meet publicly on Tuesday at 4:30 p.m. in the council chambers on the top floor of the Watsonville Civic Plaza, 275 Main St., Watsonville. The meeting will begin with reports on highlights of the Parks and Community Services Department’s summer program by Recreation Director Imelda Negrete and the Pavement Management Plan by Public Works Director Courtney Lindberg, followed by a closed session to discuss legal issues at 5:30 p.m. and the regular meeting Public meeting at 6:30 p.m. in which the majority of the agenda items will be discussed.