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AGENDA ITEM — 3C <br />'It <br />,ARZEN HILLS <br />MEMORANDUM <br />DATE: July 17, 2023 <br />TO: Honorable Mayor and City Councilmembers <br />Dave Perrault, City Administrator <br />FROM: Jessica Jagoe, Community Development Director <br />Julie Hanson, Assistant to the City Administrator/City Clerk <br />SUBJECT: THC (lower potency) and Adult Use (full strength) Cannabis Discussion <br />Budgeted Amount: Actual Amount: Funding Source: <br />N/A N/A N/A <br />Council Should Consider <br />Council should discuss and provide direction on the draft ordinance for establishing land use <br />definitions and regulations for Lower -Potency Hemp Edible Sales as well as additional comment <br />on Adult Use (full strength) Cannabis sales. <br />Background <br />At the June 20, 2023 Work Session meeting, the City Council directed staff to bring back to the <br />Council ordinance language that would regulate the sales of Lower -Potency Hemp Edibles. <br />Based on that direction, city staff worked with the City Attorney's office to prepare a draft <br />ordinance that incorporates language recommendations from the work session discussion. The <br />proposed ordinance would introduce a new land use classification specific to Lower -Potency <br />Hemp Sales that would establish this as a conditional accessory use only to businesses with a <br />principal Retail Sales and Service land use. This means there cannot be a standalone shop for <br />these products and any business interested in selling Lower -Potency products would need to <br />come before Council and apply for a Conditional Use Permit. As proposed, lower -potency hemp <br />edible sales would be limited to the B-3, Service Business Zoning District (i.e. those businesses <br />along Lexington Avenue south of 694 to the railroad/north of County Road E). By specifying <br />this to a commercial zoning district it would preclude a residential property from being allowed <br />to apply for either a Class I or a Class II Home Occupation. It should be noted that Retail Sales <br />and Service as a principal use is permitted in the B-2, B-3, and B-4 Zoning Districts. Lastly, the <br />draft language includes a separation of lower -potency hemp edible sales to such uses as schools, <br />day cares, residential treatments facilities, and public parks. The City Council should discuss <br />and provide direction on adding language that would also require a separation between Lower - <br />Potency Hemp Edible Sales establishments. <br />Page 1 of 2 <br />