Are you a social equity applicant that wants to apply for a retail storefront in Los Angeles? Specifically, Central City, Central City North, Harbor Gateway, Sherman Oaks – Studio City or Venice? Here is what you need to know.
What is the Public Convenience or Necessity Process?
In the City of Los Angeles, each Community Plan Area has a maximum number of Storefront Retailer Commercial Cannabis licenses (Type 10 and Type 12) that may be granted (L.A.M.C. §§ 104.01(a)(40).
The recent reemergence of the Public Convenience or Necessity (PCN) process allows social equity applicants to apply for licenses in areas that have exceeded the maximum number of licenses permitted. Additional licenses will be granted if the Los Angeles City Council determines that an applicant’s desired location meets certain convenience or necessity requirements (L.A.M.C. §§ 104.03).
The City Council will use the following standards to determine if a commercial cannabis license serves a public convenience or necessity:
- The existing commercial cannabis business in the requestor’s Community Plan Area are concentrated in one area, such that the requestor’s business, located in another area, would serve the public convenience or necessity; or
- The proposed business premises would serve an area of increased density or consumer traffic, including but not limited to an entertainment or commercial corridor, such that the proposed location would serve the public convenience or necessity by satisfying a higher demand for retail locations; or
- The proposed business premises would be located in an area with a high number of unlicensed commercial cannabis retail establishments, such that an additional licensed location would serve the public convenience or necessity by satisfying a higher demand for retail locations and reduce patronage of unlicensed establishments; or
- The requestor’s business would include clearly specified public safety related features, such that the operation of the requestor’s business would serve the public convenience or necessity by likely reducing crime or nuisance activity in the surrounding area.
Who can apply?
To apply and earn a license through the PCN process, you must be a social equity applicant or have a social equity applicant partner. You may have existing licenses–although you may hold no more than three total retail licenses (See L.A.M.C. §§ 104.02(a)(2)).
The desired retail location must be in a Community Plan Area that currently has undue concentration. Undue concentration occurs when a given area’s total number of retail licenses exceeds one per 10,000 residents. Currently, these locations include Central City, Central City North, Harbor Gateway, Sherman Oaks – Studio City and Venice.
What is the process for filing an application and earning a license?
Step 1: Confirm Your Proposed Location
Determine if your desired location is in one of the Community Plan Areas accepting PCN applications using the Department of Cannabis Regulation (DCR) Licensing Map. When applying, you do not need to demonstrate site control, although your landlord must attest to their consent of commercial cannabis operations at that location.
Step 2: Prepare Initial Records
Make sure you have both a Business Tax Registration Certificate (BTRC) and a Legal Business Entity Record with the Department of Cannabis Regulation.
Step 3: File a Pre-Application Request
Prepare and file a Pre-Application Request through the Department of Cannabis Regulation Licensing Portal by August 29, 2023 at 11:59pm (PST). Applicants must explain how their request meets one or more of the City Council’s public convenience or necessity requirements described above, and should engage with and seek written input from key stakeholders in the desired Community Plan Area, including the relevant Neighborhood Council, Los Angeles Police Department Division, local chamber of commerce, and at least one substance abuse intervention, prevention and treatment organization within the Community Plan Area.
A $597 fee must be submitted by September 29, 2023 in order for your pre-application to be reviewed. Once paid, the DCR will conduct a land use review for your proposed location and determine if your application may move forward in the PCN process. If the DCR determines that the Pre-Application Request is not eligible for further processing, applicants may submit a new Pre-Application Request for a new proposed location.
Step 4: Submit PCN Filing Fee to Submit Official PCN Request
Once your pre-application is approved, you must submit a $1,592 PCN Filing Fee by November 1, 2023. Once paid, your PCN application will be ready for review by the City Council. DCR anticipates sending all PCN applications to the City Clerk by November 13, 2023.
Step 5: City Council Reviews PCN Requests & Issues Decisions
City Council will have until February 11, 2023 to approve or deny PCN applications. Altogether, it is expected to take about six months to complete the PCN process and receive a decision from the City Council.
The current PCN window is only open for two weeks; Although PCN submissions are expected to reopen again in 2024. If you are interested in pursuing a retail license through the PCN process, contact Manzuri Law today to learn more about how we can help you put together a winning application.