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Cities in San Mateo County have had a broad spectrum of reactions to cannabis <br />business. Several cities, including Belmont, Colma, and San Mateo, have opted not to <br />allow cannabis businesses. Other cities, including Burlingame, East Palo Alto, Foster <br />City, and Woodside have adopted interim bans with the intention to further research the <br />issue. The rest of the cities are in the study phase or are considering allowing some <br />commercial businesses within their jurisdiction. San Carlos and Half Moon Bay are <br />considering regulations allowing cannabis businesses, including cultivation, <br />manufacturing, and testing. <br />E. Staff Recommendations <br /> <br />In general, staff recommend that the City take limited steps to enable personal <br />cultivation and receipt of cannabis-related products, and that the City apply the local <br />business license tax to both medical and recreational cannabis activity. Staff believe the <br />application of this tax is appropriate in recognition of the profits generated by this <br />activity, and other communities have observed that taxing only recreational cannabis <br />products can have the unintended consequence of encouraging recreational users to <br />obtain cannabis-related products under medical cannabis provisions in order to avoid <br />the tax. <br /> <br />Developing land use policies and inspection and enforcement mechanisms to regulate <br />commercial cultivation, manufacturing and sale of cannabis products would take a <br />significant amount of staff time. At this time, staff does not believe this is a high priority <br />for the business or residential community or the City Council, though the City Council <br />has not yet discussed this topic and the community outreach process may provide a <br />new understanding. To date, staff has not received inquiries regarding establishment of <br />cannabis-related businesses in Redwood City. Unlike other communities in San Mateo <br />County or other parts of the state, Redwood City currently does not have a significant <br />agricultural base, so Redwood City may not be a likely location for commercial <br />cultivation. Similarly, manufacturing and testing of cannabis-related products may be <br />more likely activities in communities which have other scientific and manufacturing <br />industries. In the future, should business interest arise, the City could consider <br />development of land use policies and the associated inspection and enforcement <br />activities. <br /> <br />Additionally, though allowing commercial cultivation is required for an agency to receive <br />state grant monies funded through the state excise tax, the mechanism for distributing <br />those funds has not been determined and is not guaranteed. As a result, it is <br />conceivable that significant staff and City Council effort could be expended to establish <br />regulations for activity that may not be desired by the residential or business <br />community, and for which the City might not receive any state grant funds. <br /> <br />For these reasons, staff recommend the following approach for the City Council’s <br />consideration. The proposed approach could be in place for a fixed period of time, such <br />as through December 31, 2018, in order to assess market forces and community <br />interest over time, and the City Council would retain the ability to extend or reverse the <br />ban at any point. Staff recommends that public outreach be conducted to obtain <br />8.B. - Page 8