In January, Davina Smith became Sacramento city’s cannabis program manager. A lawyer, she started her career in Humboldt County as a deputy district attorney and later served as deputy county counsel. There, her focus was on land-use and code-enforcement matters. Since it was Humboldt, a lot of her business was related to cannabis. It seems Sacramento has plenty of its own cannabis business as well.
What does your office do exactly?
At the Office of Cannabis Management, we are the permitting body and the reviewing body. We also do our CORE (Cannabis Opportunity Reinvestment and Equity) program. We don’t do enforcement, although if we come across things, we may recommend enforcement to the code enforcement unit.
What are the permits for?
There are a number of cannabis permits that the city is allowed to issue, so pretty much we allow every single type of cannabis business activity in the city of Sacramento. We don’t allow commercial outdoor cultivation, and we don’t allow cannabis smoking lounges (or) on-site consumption of cannabis. Those are basically the only two things we don’t allow. We do have a cap for storefront dispensaries, and that cap is currently 30. Because of that cap, we do renewals for storefront dispensaries, but we don’t issue new permits right now.
I’ve heard getting a permit is complicated and expensive.
In order to get a cannabis business permit in the city of Sacramento, you have to have a location and then you have to have a CUP—a conditional use permit—for that location. You have to apply for that conditional use permit. One of the things that costs people a lot, both in terms of just sheer expense and time, is the CUP process. CUP is anywhere from about $15,000 to $30,000.
It’s either reviewed and decided upon by a zoning administrator, or if there are sensitive uses within a certain distance, then it has to go up to the planning and design commission and there’s a hearing for whether it should be approved or not. Depending upon the complexity and any request for extra time by an applicant, those can take anywhere from two months to eight months to be processed, which is a good period of time to hold onto a business location and pay rent on that location. Then, once that’s approved, you have to make sure you have whatever build–out you’re going to do, your tenant improvements.
While you’ve been doing that, you’ve also been applying for business operating permits from my office. We have a list of requirements. It can easily take a year if you’ve got your stuff together, a year and a half.
That’s a lot of money up front.
That is a tough pill to swallow, and that’s on top of a security deposit and rent that you have to pay for a commercial space while you’re waiting for this to happen. In most industries, the landlord pays for that CUP because it runs with the land and ultimately it benefits the landowner. In cannabis, property owners have been able to shift so much of this onto applicants.
Does your office have any stake in social equity?
I think we do. Social equity, racial equity, economic equity is something that this country has lacked for a very long time. We’re just over a year into the CORE program, and there are definitely successes. I think there are areas where we can be more successful. That’s something we’re looking at and evaluating, and we’re going to be reporting back to the city council eventually on that.
We’ve spent a lot of time talking about it, working with applicants in our social equity community. It’s interesting work. Sometimes it’s very hard work. Sometimes it’s heartbreaking work because, for all that, we’re also city employees and the city has a certain procedure on how things are done. The council has given direction to open up another 10 dispensary permits, and those are going to be only for social equity members.
