Huntington Beach City Council passing cannabis choice back to voters this November

Russell Neal, lower right, sits among others listening during a Huntington Beach City Council study session Tuesday regarding cannabis businesses.
(Scott Smeltzer / Staff Photographer)
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Cannabis has been legal for recreational use in California for more than five years, since voters approved Proposition 64 in 2016. Any pot shops that have popped up, however, have not been in Surf City.

Huntington Beach does not allow cannabis shops within its borders, though that might not be true for much longer.

The City Council held perhaps its most extensive discussion of cannabis yet at its meeting Tuesday night. A study session on the topic of potential cannabis business taxation and representation was followed by an agenda item featuring a presentation from city senior administrative analyst Grace Yoon-Taylor.

Ultimately, the City Council voted 5-2 to direct staff to come back with resolutions to place two measures on the November general election ballot. The measures will ask voters if the city should allow and regulate retail and nonretail cannabis businesses and, if allowed, impose local excise taxes of up to 6% for cannabis retailers and up to 1% for nonretailers.

Councilmen Mike Posey and Erik Peterson provided the “no” votes.

“If the idea is to introduce cannabis for a revenue, you have to have that with a tax, and I’m opposed to new taxes,” Posey said. “I guess I’m a little bit internally conflicted with this, and I’m also conscious of the social cost, too.”

Peterson, Dan Kalmick and Rhonda Bolton serve on a cannabis ad hoc subcommittee formed in December. The city has also has sought input from residents and business owners, including during a June 9 community forum.

Huntington Beach City Councilman Erik Peterson, left, speaks during a study session regarding cannabis businesses on Tuesday.
(Scott Smeltzer / Staff Photographer)

Measure A was put on last month’s primary election ballot asking city voters to adopt a special tax on cannabis businesses if they were permitted. It received 64.58% approval in final numbers from the Orange County Registrar of Voters, just shy of the two-thirds supermajority needed to pass.

But the City Council continues to explore the idea and has discussed developing regulatory and zoning ordinances for cannabis businesses. The items on the November ballot would require a simple majority, rather than a supermajority.

Huntington Beach would join nearby cities Costa Mesa and Santa Ana, the only two in Orange County that allow commercial cannabis shops. Costa Mesa approved retail cannabis in 2020 and recently issued its first two conditional use permits to pot shops.

“I think that with two out of three people essentially saying, ‘Yes, we agree to a tax,’ and 50-something percent several years ago, I think that likely they will vote to allow commercial cannabis in Huntington Beach,” Kalmick said.

Regulatory details were discussed and decided via a straw vote Tuesday. If voters approve cannabis permits in November, up to 10 permits would be issued citywide for retailers. Storefront dispensaries and delivery-only facilities would be permitted, but sales by vehicle, kiosk or vending machine would be prohibited.

The council discussed having two of the 10 businesses be “locals only” for Huntington Beach residents.

The number of permits for nonretailers would not be capped but controlled by zoning and buffer restrictions. Nonretailers would be allowed to grow cannabis via indoor cultivation, manufacture, test and distribute it. But outdoor cultivation, microbusinesses, cannabis events and drive-through services would be prohibited.

Resident Russell Neal poses with an anti-cannabis sign outside of Huntington Beach City Council chambers on Tuesday.
(Scott Smeltzer / Staff Photographer)

Retailers would have to be buffered by at least 1,000 feet from schools, parks, daycare centers and youth centers. Nonretailers would have buffer restrictions between 600 to 1,000 feet in the industrial zones of the city.

According to city analysis, cannabis taxes could generate up to $600,000 annually. That money would be earmarked to fund police services, homelessness prevention and behavioral services.

Kalmick said the subcommittee would meet again to iron out some of the details.

“If there’s anything else that flags, we’ll bring it back to council,” he said. “Then, once we get that list through, we’ll have another town hall [meeting] and get some more community input.”

Speakers at Tuesday’s meeting largely spoke on other issues, though resident Chuck Burns was staunchly opposed to cannabis businesses coming to Surf City.

“The last thing we need is more people driving, walking, riding bikes and sitting all around town stoned on smoking weed,” Burns wrote in an email to council members.

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