A cap on the number of cannabis retailers allowed to operate in Costa Mesa is part of a series of new regulations the City Council will consider on Tuesday, March 19.

Since August 2021, when the city started accepting applications for opening a retail cannabis store in town, 22 permits for storefronts have been approved.  Now, the City Council will decide if it will set a cap at 30 under the proposed ordinance update.

The council’s vote would end the hopes of several retailers currently in the permitting process with the city to open a cannabis store. Within a couple of months of opening the process, the city had nearly 60 requests for permits filed with City Hall.

There are more than 30 retailers that have pending applications, according to a city staff report. Only eight more would get approved should the council move forward with updating its cannabis laws.

Costa Mesa has been one of the most welcoming cities in the county to cannabis retail sales. It’s one of only three, along with Santa Ana and Stanton, that allow cannabis retail storefronts and initially set no cap on how many would be allowed to open, though it has some requirements for acceptable locations.

Santa Ana, which has almost three times as many residents as Costa Mesa, has its cap at 30 retail storefronts. Long Beach sets its cap at 40 and San Diego at 36.

Under the proposed ordinance, the city, once it approves its 30th cannabis store, wouldn’t issue any more permits until the number of existing permits falls below 15.

The ordinance would also bar stores from marketing their products to people under the age of 21.

The council will also consider further limiting where new cannabis storefronts can open. Those changes include a minimum distance of 500 feet between cannabis storefronts, at least 100 feet between storefronts and residentially zoned areas and increasing the minimum distance between storefronts and youth centers, like schools and daycares, to 1,000 feet from 600.

Ten of the already-permitted cannabis businesses are within 500 feet of another one, according to a staff report, but wouldn’t be affected if the council makes changes.

Costa Mesa taxes cannabis sales at 7%, which mostly goes into the city’s general fund. Consumers spent more than $8 million on cannabis in Costa Mesa for the last quarter of 2023, according to state data; at least nine stores were operating as of an early February city update. Santa Ana had $45 million in cannabis sales for that same time.

Nearly two-thirds of voters in 2020 approved a measure that allowed the city to create its cannabis laws allowing retail storefronts. Several cannabis stores have opened up in the city since including multiple along Harbor Boulevard.

The city’s Planning Commission in January unanimously recommended the City Council consider the changes.

The City Council meets at 6 p.m. on Tuesday, March 19, at 77 Fair Drive.

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