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Artesia Moves Closer to Permitting Commercial Cannabis in City

By Brian Hews

On October 10, 2022, the Artesia City Council adopted an ordinance that amended the city’s code to provide for zones where commercial cannabis businesses could open a business.

The ordinance, which some businesses north of the freeway complained about, mandated that the commercial cannabis facilities could only be located south of the 91-Artesia Freeway.

After adopting the cannabis ordinance,  the city council approved two additional ordinances to create a framework for application submittals, reviewing and scoring applications, and awarding cannabis permits. The city mandated that a maximum of three retail commercial cannabis permits could operate within city borders at any time.

Soon after the adoption, the city council designated a time frame to accept applications for cannabis permits, running from February 6, 2023 through March 8, 2023.

But before closing, an applicant north of the 91 freeway filed a lawsuit against the city alleging that the ordinance’s language “was not clear and that it allows commercial cannabis businesses to locate north of the 91 freeway.”

The city was forced to postpone the permit program on March 16 to evaluate the pending legal action. It came up with revisions to the code that reaffirmed that cannabis businesses may only be located south of the 91 freeway.

In essence, the city was doing that already when it denied any permits north of the 91 freeway.

In addition, Artesia also streamlined the process after permit approval related to modifications of the existing design or exterior of the building.

Usually, that kind of change go through a Planning Commission review, but under the proposed revisions, if an approved cannabis business seeks “minor modifications” to an existing structure, then it would be reviewed by the Community Development Director.

Minor modification means that less than sixty percent of the building facade is being modified; any changes over 60% or any appeal of an administrative design review would still go to the Planning Commission.

Finally, the city “strengthened the City’s oversight of permitted businesses,” including providing the city manager more flexibility to create the process for how an application is scored. The changes will not change the scoring criteria set by the city council.

Revising the requirement that permittees must provide the city with signed leases. Instead, permittees would have to give the city a notarized and recorded memorandum of lease.

Scrutinizing whether applicants or renewal businesses have failed to collect, report, or remit cannabis-related taxes to the State or other local jurisdictions and providing the process by which a permit may be suspended or revoked.

Once fully operational, the businesses are expected to generate between $600,000 and $800,000 for city coffers.