January 20, 2017

After years of debates, Long Beach finally did it!  On November 8, 2016, voters approved Measure MM, legalizing the operation of medical marijuana businesses (MMB) within the city. The measure sets forth the requirements all future business owners must satisfy to operate a business in the city. What are these requirements? And how does one start the application process? Let’s find out!

Regulatory Framework

Measure MM has specific guidelines on where a MMB can operate in the city. Businesses may not be:

1. operated in an area zoned exclusively for residential use

2. located within 1,000-foot radius of a school or public beach

3. located within a 600-foot radius of a public park or public library

Furthermore, a dispensary will not be permitted to operate within a 1000-foot radius of any other dispensary.

The number of licensed dispensaries will also be tightly regulated. Per measure MM, dispensaries are restricted to no more than one dispensary for every 15,000 residents, and no less than one dispensary for every 18,000 residents. Based on the current population of Long Beach, the city will allow anywhere from 27 to 32 dispensaries.

Considering the restrictions above and the demand in starting a MMB in Long Beach, we predict a significant effect on the real estate market. Shrewd entrepreneurs will undoubtedly act quickly.

Application Process

Starting a MMB under measure MM requires the submission of an application to the city council. Applications will need to include:

  1. a business license application
  2. a medical marijuana business license application
  3. a medical marijuana dispensary operating plan
  4. a payment of application fees for a total of $226.45

Application materials have been made available on the city website and at City Hall since January 2, 2017.

Priority Rules for Awarding Dispensary Licenses

To reward the most responsible applicants, Measure MM has put in place a “priority point system”. Dispensary owners who (1) won a permit in the September 2010 Lottery (LBMC 5.87), or (2) were allowed by the City to operate after February 14, 2012 (LBMC 5.89.055) will be granted priority groups status.

Priority Group 1 status will be given to those dispensaries satisfying both (1) and (2) and who apply using the same location they have previously occupied in 2012. Whereas, Priority Group 2 status will be given to dispensaries satisfying (1) and (2) but using a different location as the one used in 2012.

Group 1 will be issued licenses first, followed by Group 2. The application period for both Group 1 and 2 runs from January 23 to July 24 of 2017. If a completed application is not submitted within that time frame, the Priority Group status will be forfeited.

Dispensary license applicants who do not meet conditions for priority status, will be submitted to a criteria-based point system under which applicants totaling the highest amount of points will be awarded licenses. The City will post the point priority rankings on July 24, 2017. If there are more applicants with the same point value than there are final spots in the application process, a public lottery will take place on August 7, 2017.

Application for All Other Businesses

For MMBs other than dispensaries (such as distributors, manufacturers, cultivators (indoor only), and laboratory testing sites), the application process will be different. The review process will not include the priority status, point ranking, and lottery system mentioned above. Furthermore, the 1,000-foot buffer rule between dispensaries, and cap on the total number of businesses will not be applied to non-dispensary MMBs.  However, all application materials will otherwise remain the same.

Disclaimer: This article has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice.