City of Reno
Nevada

Staff Report
10541

Staff Report (For Possible Action): Presentation, discussion and potential direction to staff for a potential ordinance change regarding: 1) granting of additional Retail Marijuana Store licenses under Title 5, Chapter 5.22, Section 5.22.012; and 2) modifying hours of operation for Medical Marijuana Dispensaries and Retail Marijuana Stores under Title 18, Chapter 18.08, Section 18.08.202.

Information

Department:City Manager - Government AffairsSponsors:
Category:Presentation

Recommendation and Proposed Motion

Recommendation:  Staff recommends Council give direction to staff to introduce an ordinance to make any changes to the process of granting Retail Marijuana Store licenses and/or the hours of operations for the retail stores as desired by Council.

 

Proposed Motion:  I move to direct staff to come back to Council with ordinance introductions for the proposed changes.

Staff Report Formal Body

Summary: The Nevada Department of Taxation (DoT) has ranked and selected applicants for conditional Retail Marijuana Store licenses.  Pursuant to its regulations, DoT allocated six additional licenses to the City of Reno.  Pursuant to Reno Municipal Code (RMC), Council has only authorized four additional licenses to be granted.  As such, staff would like to discuss this scenario to determine how Council would like to proceed with the licensing process.  Furthermore, staff is looking to Council for any further direction on the hours of operation allowed by RMC for Medical Marijuana Dispensaries and Retail Marijuana Stores.

 

Previous Council Action:  On June 6, 2018, Council adopted Ordinance Number 6467, which amended RMC 5.21 (medical marijuana) and created RMC 5.22 (recreational marijuana).  Included in this ordinance, in the new RMC Section 5.22.012(a), was an explicit limit on the number of Retail Marijuana Store licenses in the City of Reno.  The net result of this limit was to only allow for four additional Retail Marijuana Stores.

 

Also on June 6, 2018, Council adopted Ordinance Number 6468, which amended Title 18 to amend provisions related to medical marijuana businesses and to create new land use and zoning rules for recreational marijuana businesses.  Included in this ordinance, amended into RMC Sections 18.08.202(b)(20) and (26), were rules applied to Medical Marijuana Dispensaries and Retail Marijuana Stores that limit their hours of operation from 8:00 a.m. to midnight seven days a week.  

 

Discussion:  The purpose of this presentation is to have a discussion with Council to determine if it would like to consider changes to Title 5 and Title 18 to address the issues discussed herein – namely the limit on granting Retail Marijuana Store licenses and hours of operations for the medical and retail stores.  Staff is looking for feedback and direction from Council for staff to bring back ordinances to incorporate any of these changes, which are discussed in more detail below.

 

Limit on Retail Marijuana Store Licenses:

As noted above, Council through its June 6, 2018 ordinance has limited the total number of Retail Marijuana Stores in the City of Reno to eight.  Because there are currently four existing and operating Retail Marijuana Stores, this leaves the possibility of four more stores under the code as currently written.

 

Pursuant to DoT regulations (LCB File No. R092-17, Sec. 80(3)), the department allocated the licenses for Retail Marijuana Stores as described in Nevada Revised Statutes (NRS) 453D.210(5) to jurisdictions within each county proportionally based on the population of each jurisdiction, which resulted in a total of ten to be allocated to the City of Reno.  As such, on July 6, 2018, DoT informed the City of Reno that it had six remaining licenses to be allocated since four had already been licensed and were operating.

 

Following an application period for these licenses that ended in September, DoT has since ranked, selected applicants, and issued conditional licenses to six applicants.  On December 5, 2018, as required by DoT regulations (LCB File No. R092-17, Sec. 80(4)), the City of Reno was provided the list and informed of the six conditional license recipients and their state rankings.  The conditional licenses are valid for 12 months, and the applicant must be operational (including final inspection, local jurisdiction license, etc.) before it may receive a final license from DoT.  In short, the applicants still have many steps to complete before receiving a final state license, including, but not limited to, receiving a local business license and special or conditional use zoning permits as required by the local jurisdiction.

 

According to RMC 5.22.012(a), the city has authorized only four additional Retail Marijuana Store licenses and has provided that they will be considered in order of the DoT’s rankings.  The section reads:

 

Following issuance of a marijuana establishment license issued by the department pursuant to NRS 453D.210, the city will evaluate whether to grant any proposed marijuana establishment a business license. . . The city initially authorizes up to eight retail marijuana stores, with up to four retail marijuana store licenses being provided to existing medical marijuana dispensaries as dual licensees, and up to four new retail marijuana licensees to new retail marijuana stores. The issuance of city licenses for marijuana establishments, including retail marijuana stores, will be considered in order of the department's rankings pursuant to the regulations. . . . [Emphasis added.]

 

Because of the provisions in the above section, and without further changes to Chapter 5.22, staff will only work with the applicants who are ranked number 1 through 4 from DoT.  If it is the Council’s desire to expand the number of potential Retail Marijuana Licenses available in the City of Reno for the additional conditional licenses from the state, it should direct staff to begin the process of bringing an ordinance to amend Chapter 5.22 accordingly.

 

If it is Council’s desire to consider granting city licenses to either the fifth or sixth ranked applicant and continue to limit the new licenses to four, it should direct staff to begin the process of bringing an ordinance to amend Chapter 5.22 accordingly.  Staff does not recommend this option and would suggest that Council consider expanding the number possible licenses should Council want to be able to consider the fifth or sixth ranked applicants. 

 

Hours of Operation:

In a majority of the zones within the City, the allowed hours of operation are 6:00 a.m. to 11:00 p.m.  Several overlay zones allow 24 hour operations by right.  Community safety, public consumption, and compatibility with surrounding uses were some of the concerns expressed during the stakeholder outreach prior to the enactment of the recreational marijuana RMC provisions. 

 

Hours of operation issues are typically associated with retail establishments.  State law prohibits unauthorized people from entering into cultivation, production, or laboratory facilities.  As such, this discussion is intended to only focus on the hours of operation for the Medical Marijuana Dispensaries and Retail Marijuana Stores.  The policy decision matrix from the previous staff presentation on this issue is reiterated herein for reference, but please note that Title 18 has already been changed to create the 8:00 a.m. to midnight allowable hours: 

 

 

 

Policy Consideration

Positive

Negative

Code Default

Already written in code

 

Easy to administer

 

No impact to existing establishments operating under the early start program

 

No conflict with the existing medical marijuana regulations 

 

Treats these businesses similarly to other businesses 

Lower levels of street activity to deter crime that may occur during evening hours

Increases the potential for public consumption

Higher probability of intoxicated people causing problems

Difficult to enforce hours of operation with certain zones allowing 24 hours and others not Increased demand on public safety resources outside of maximum staffing hours  

6:00 a.m. to 11:00 p.m.

Easy to enforce a standard that is consistent across all locations

Consistent with the standard hours in the code

Reduction in the hours of operation will reduce the negative activities that occur later in the evening, thereby reducing crime potential 

There may be a conflict with those establishments that will also operate as a medical dispensary

Lower levels of street activity to deter crime that may occur Increases the potential for public consumption (less than 24 hour operations)

Higher probability of intoxicated people causing problems (less than 24 hours)

Increased demand on public safety resources outside of maximum staffing hours

10:00 a.m. to 10:00 p.m.

Easy to enforce a standard that is consistent across all locations

Operating during the hours of highest number of officers on patrol, increasing the ability respond to incidents    Reduced impact to surrounding uses

Decreased business hours for the businesses

 

Not consistent with the standard operating hours in underlying zones

 

Only type of business with these operating hours allowed by code   

 

Currently the hours of operation for both Medical Marijuana Dispensaries and Retail Marijuana Stores are limited by RMC 18.08.202(b) to between 8:00 a.m. and midnight seven days per week.  This change was directed during the ordinance adoption hearings and was based on lining up Reno’s allowable hours of operation with that of our regional partners (Washoe County, City of Sparks) to ensure the Reno businesses could remain competitive during late hours for this region.

 

During the process of adopting these hours of operation, at least one operator expressed concern that the limited hours (the operator is in a normally 24-hour zone) impacted their business model as they had been staying open until 3:00 a.m.  This presentation will give Council the opportunity to further discuss this issue and potentially direct staff to begin processing changes to Title 18 to incorporate revised hours of operations for these two types of businesses

 

Financial Implications:  None at this time.

 

Legal Implications:  The laws are discussed throughout the body of the staff report.