San Diego legalizes marijuana cultivation, manufacturing

The City of San Diego legalized marijuana cultivating and manufacturing on Sept. 11, limiting their locations to industrial zones.

After a lengthy hearing with hours of public comment, San Diego City Council voted 6-3 to approve an option to allow testing labs, cultivation, distribution and production of marijuana products with approval of a conditional use permit. Councilmembers Lorie Zapf, Chris Cate and Scott Sherman voted against it.

In voting in favor, District 1 Councilmember Barbara Bry said regulating the marijuana supply chain will ensure that consumers have a safe and vetted product and will deter an illegal black market.

“By allowing for local government oversight of the cannabis industry, we can benefit from new jobs and a new source of much-needed tax revenue for the general fund. San Diego voters overwhelmingly turned out to pass Proposition 64 and it is our responsibility to put reasonable regulations in place that protect public safety and enhance our local economy,” Bry said. “If we don’t allow all parts of the supply chain in San Diego we are merely enabling a large black market and San Diego consumers are counting on us to provide them with a safe product.”

San Diego Police Chief Shelley Zimmerman and Mayor Kevin Faulconer were in favor of another option on the table that simply allowed testing labs in those same industrial zones. At the Sept. 11 meeting, Zimmerman said that expanding marijuana facilities will have “enormous” consequences on public safety. She said over the past two and a half years at the legal dispensaries in the city, officers have responded to 272 radio calls, including thefts, armed robberies, assaults and shootings.

“As the chief of police I have the privilege of speaking with thousands of community members,” Zimmerman said. “Overwhelmingly they have asked me to be the voice of the voiceless…I urge you not to allow any further marijuana facilities in our city.”

In voting against the proposal, Zapf said she was listening to her police chief.

“(Chief Zimmerman) said this option is detrimental to our public safety and I think we are going down the wrong path,” Zapf said. “I can’t believe this is the message this council is sending to our youth and I’m not going to have any part of it.”

Per the new regulation, there is no cap on facilities per district as few of the council districts have the appropriate zoning for the facilities — the cap on retail marijuana outlets is four per council district.

The council did approve a citywide cap of 40 and currently there are 27 business tax certificate (BTC) holders who have been allowed to operate to supply the existing medical cannabis market, including one in District 1.

City ordinance requires that the facilities be 1,000 feet from public parks, churches, childcare, playgrounds, libraries, residential care facilities and schools. The facilities also must be 100 feet from marijuana outlets and retail sales are strictly prohibited.

During public comment, those in favor of the regulations said that the 1,000 feet policy should not apply to the manufacturing and cultivation facilities because there is no public access to them. Phil Roth, executive director of United Medical Marijuana Coalition, said the 100-foot limit from retail outlets also seemed “unnecessary” as it eliminated some of the limited available industrial-zoned lands throughout the city.

Alex Sherer, president of United Medical Marijuana Alliance Coalition, said that the legal supply chain needs to be able to compete with the black market.

“If we don’t have a robust production market, prices will skyrocket and this will give the black market an enormous competitive advantage which we are already having a hard time dealing with,” said Sherer.

At the hearing, councilmembers heard input from local businesses who look to benefit from the new regulations, from the owner of a wholesale bakery in Miramar who is interested in exploring cannabis edibles to Dr. Jason Poulos, the CEO of Librede, a life science company that has developed the world’s first yeast-based cannabinoid production platform.

“We have an opportunity to make San Diego a leader in the multi-billion dollar cannabis industry just like has been done in the biotech and pharmaceutical markets,” Poulos said. “We want to construct a state-of-the-art production facility and hundreds of high-paying biopharma jobs, develop premium therapeutics and make the city the center of a global industry. This is what San Diego is all about, improving lives through innovation.”

Several residents spoke out against allowing marijuana facilities in their communities, citing concerns about health and public safety, and the impact of more marijuana available in areas that are already “stressed and struggling.”

Some representatives from the San Dieguito Alliance for Drug Free Youth expressed concerns about the commercialization of marijuana’s impact on youth and the necessity of expanding the supply chain when so much marijuana is already being produced. According to Scott Chipman, California already produces six to 12 times the amount of marijuana that the state consumes: “We are the drug cartel for the United States”.

“San Diego is our home and marijuana continues to destroy our neighborhood and quality of life,” said a 14-year-old City Heights resident. “Please protect us from this lawless, profit-driven industry.”

District 9 Councilmember Georgette Gomez said she appreciated the concerns expressed by several of her district members but reminded them that facilities will be limited to industrial zones that must be 1,000 feet from “sensitive receptors,” such as parks and schools, and 100 feet away from residential areas.

Councilmember Chris Ward stressed that what they are looking to do is strike a balance between adults’ rights to access marijuana safely without placing harm on San Diego’s neighborhoods, children and public safety officers.

He likened the discussions to the city’s process of building the regulations and framework for its $900 million craft beer industry — there were similar issues with land-use constraints and manufacturing, and distribution being concentrated in certain districts. He said they wouldn’t tell Stone Brewery to manufacture everything in Riverside County or tell Ballast Point to only grow hops in Humboldt County. Ward said if done properly, the same can be done with cannabis.

“Having sound policy and regulations in place will allow the city to enforce its rules and assist the cannabis industry in regulating itself,” Ward said.

Public comment and memos distributed by Councilmembers Cate and David Alvarez demonstrated that there are a number of concerns that the council still needs to tackle regarding quality of life (including the odor from facilities), advertising and delivery services. Those issues will be referred to the council’s public safety committee.

“It’s an evolving process,” Bry said. “This is only the beginning and I look forward to broad participation from the community as we look forward to regulating this industry.”