City Council Study Session Agenda and Packet 2010 10 26

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PAGE TWO SUBJECT: DISCUSSION — REGULATION OF MEDICAL MARIJUANA DATE: OCTOBER 26, 2010 pertaining to deliveries, restrictions on signage, standards that facility owners and employees must satisfy, standards for a "needs and desires" assessment or other measures. If Council decides to take this approach, staff would have to develop a comprehensive licensing ordinance. Attached is an updated version of the matrix previously prepared by the Planning staff on regulations adopted by other cities along the Front Range. The right hand side of the matrix shows staff's recommendations on regulatory elements to include in the City Code if Council desires to permit MMOs. Also attached is a map showing 500 foot and 1000 foot separations from all schools and day care uses. HB 1284 provides that a municipality acting by ordinance may vary the distance restrictions or eliminate one or more types of facilities from application of the distance restrictions. HB 1284 requires that by September 1, 2010 each medical marijuana center certify that it cultivates at least 70% of the medical marijuana necessary for its operation. Consequently, if Council desires to permit MMOs in Louisville, the City will need to consider whether commercial cultivation of marijuana will be allowed, allowed with restrictions, or completely prohibited. Should it be allowed, staff recommends limiting cultivation to indoors only, along with other regulatory elements listed in the matrix. FISCAL IMPACT: Two MMOs currently operate in the City of Louisville. Because there are only two, staff cannot disclose the revenue generated by these operations without violating laws concerning the confidentiality of that information. However, we can say that if they continue to generate sales tax at the current rate, both operations will be among the City's top 50 sales tax generating vendors for 2011. Accordingly, sales tax generated from medical marijuana is a significant source of revenue for the City. However, zoning, enforcement, licensing and supervision of MMOs would be the responsibility of the City and would necessarily require some additional staff time and resources should MMOs continue to be allowed in Louisville. RECOMMENDATION: Discussion. At a subsequent regular Council meeting, staff will seek direction on which approach Council desires to pursue and will thereafter prepare appropriate materials for further Council consideration as necessary. ATTACHMENTS: 1) Ordinance #1557, Series 2009 2) Ordinance #1574, Series 2010 3) City Attorney Memo on HB 10 -1284 4) Staff Matrix of Front Range Regulations 5) Map of 500 and 1000 ft. Limitations 3