HomeMy WebLinkAbout2017 12 18 Special MeetingNOTICE AND CALL
OF A
SPECIAL MEETING
OF THE
CITY COUNCIL
TO THE MEMBERS OF THE AFOREMENTIONED AGENCIES AND THE CITY CLERK OF
THE CITY OF BALDWIN PARK
NOTICE IS HEREBY GIVEN that a Special Meeting is hereby called to be held on
MONDAY, DECEMBER 18, 2017 at 7:00 PM. at City Hall — 31d Floor Conference Room 307,
14403 East Pacific Avenue, Baldwin Park, CA 91706.
Said Special Meeting shall be for the purpose of conducting business in accordance with
the attached Agenda.
NO OTHER BUSINESS WILL BE DISCUSSED
Dated: December 14, 2017
Manuel Lozano
Mayor
AFFIDAVIT OF POSTING
I, Alejandra Avila, City Clerk of the City of Baldwin Park hereby that, certify under penalty of
perjury under the laws of the State of California, the foregoing agenda was posted on the City
Hall bulletin board not less than 24 hours prior to the meeting on December 18, 2017.
101
Alejandra Avila
City Clerk
AGENDA
SPECIAL MEETING
DECEMBER18, 2017
7:00 P
CITY HALL - 31 Floor, Conference Room 307
14403 EAST PACIFIC AVENUE
BALDWIN PARK, CA 91706
(626) 960-4011
Manuel Lozano
Ricardo Pacheco
Cruz Baca
Monica Garcia
Susan Rubio
- Mayor
- Mayor Pro Tem
- Council member
- Council member
- Council member
Please note
time and
meeting
location
PLEASE TURN OFF CELL PHONES AND PAGERS WHILE MEETING IS IN PROCESS
POR FAVOR DE APAGAR SUS TELEFONOS CELULARES Y BEEPERS DURANTE LA JUNTA
.......- -- .....
PUBLIC COMMENTS
The public is encouraged to address the City
Council or any of its Agencies listed on this
agenda, but only on any matter posted on this
agenda. If you wish to address the City Council
or any of its Agencies, you may do so during the
PUBLIC COMMUNICATIONS period noted on
the agenda. Each person is allowed three (3)
minutes speaking time. A Spanish-speaking
interpreter is available for your convenience
COMENTARIOS DEL PUBLICO
Se invita al publico a dirigirse al Concilio o cualquiera
otra de sus Agencias nombradas en esta agenda,
para hablar solamente sobre asunto publicado en esta
agenda. Si usted desea la oportunidad de dirigirse al
Concilio o alguna de sus Agencias, podr6 hacerlo
durante el perlodo de Comentarios del Publico
(Public Communications) anunciado en la agenda. A
cads persona se le permite hablar por tres (3)
minutos. Hay un intdrprete parr su conveniencia.
CITY COUNCIL
SPECIAL MEETING — 7:00 P.M.
CALL TO ORDER
ROLL CALL: Council Members: Cruz Baca, Monica Garcia, Susan Rubio,
Mayor Pro Tem Ricardo Pacheco and Mayor Manuel Lozano
PUBLIC COMMUNICATIONS
Three (3) minute speaking time limit
Tres (3) minutos serA el limite para hablar
THIS IS THE TIME SET ASIDE TO ADDRESS THE CITY COUNCIL
PLEASE NOTIFY THE CITY CLERK IF YOU REQUIRE THE SERVICES OF AN INTERPRETER
No action may be taken on a matter unless it is listed on the agenda, or unless certain emergency or special
circumstances exist. The legislative body or its staff may: 1) Briefly respond to statements made or questions
asked by persons; or 2) Direct staff to investigate and/or schedule matters for consideration at a future meeting.
[Government Code §54954.2]
ESTE ES EL PERIODO DESIGNADO PARA DIRIGIRSE AL CONCILIO
FAVOR DE NOTIFICAR A LA SECRETARIA S1 REQUIERE LOS SERVICIOS DEL INTERPRETE
No se podra tomar acci6n en algin asunto a menos que sea incluido en la agenda, o a naenos que exista aig0na
emergencia o circunstancia especial, til ctrerpo tegiwslativo y so personal podran: 1) Responder brevemente a
declaraci6nes o pregUntas irechas pot, personas;` o 2) Dirigir personal a inve Cigar yro hjar asuntos para tomar on
consideraci6n en juntas proximas. [Codigo de Gobierno §54954.2]
RECESS TO CLOSED SESSION.
1. REAL PROPERTY NEGOTIATIONS Pursuant to Government Code §54956.8:
Property: 13100 Brooks Drive
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Joseph White, Becker Boards
Under Negotiation: Price and terms of payment
2. REAL PROPERTY NEGOTIATIONS Pursuant to Government Code §54956.8:
A. Property: 4145 Puente Avenue (CAN 17-01)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Edward Avakyan, Jenome Research
Under Negotiation: Price and terms of payment
B. Property: 14551 Joanbridge Street (CAN 17-02)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Lih Ping Henry Liou, Baldwin Park TALE Corp.
Under Negotiation: Price and terms of payment
C. Property: 1453 Virginia Avenue (CAN 17-03)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties. Todd Seidner, Virginia Avenue Holdings, LLC
Under Negotiation: Price and terms of payment
D. Property: 15480 Arrow Highway (CAN 17-04)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Lynn Metrow and Todd Hill, Bud King's Weed Club
Under Negotiation: Price and terms of payment
E. Property: 4507 Littlejohn Street (CAN 17-05)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Tina Honglin Guan, Lucky Medical Cannabis Development, Inc.
Under Negotiation: Price and terms of payment
F. Property: 14824 Ramona Boulevard (CAN 17-06)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Shaun Bershatski, RUKLI, Inc.
Under Negotiation: Price and terms of payment
G. Property: 13111 Spring Street (CAN 17-07)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Ming Hong Huang, 428 Cloverleaf, LLC
Under Negotiation: Price and terms of payment
H. Property: 5117 Calmview Avenue (CAN 17-08)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Victor Chevez and Helen Chau, Casa Verde Group
Under Negotiation: Price and terms of payment
I. Property: 13467 Dalewood Street (CAN 17-09)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Darrin Oganesian and Ryan Oganesian, RD Baldwin Park
Under Negotiation: Price and terms of payment
J. Property: 14837 Ramona Boulevard and
14841 Ramona Boulevard (CAN 17-10)
Agency Negotiators. Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Phil Reyes, and Alexis Reyes, Organic Management Solutions, LLC
Under Negotiation: Price and terms of payment
V,.
K. Property: 1453 Virginia Avenue, Suite "O" (CAN 17-11)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Chris Coogan, Therapy Crafted Brands, LLC
Under Negotiation: Price and terms of payment
L. Property: 5148 Bleecker Street (CAN 17-12)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Sergio Torres, Enrique Vega and Moses Acosta
Medical Grade Farms BP
Under Negotiation: Price and terms of payment
M. Property: 15023 Ramona Boulevard (CAN 17-13)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Shaun Szameit, Joshua Pierce and Kevin Huebner
Kultiv8 Group, LLC
Under Negotiation: Price and terms of payment
N. Property: 5010 Calmview Avenue (CAN 17-14)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Erika Villarruel and Art Castillo, Baldwin Park Caregivers
Under Negotiation: Price and terms of payment
O. Property: 14832 Arrow Highway (CAN 17-15)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Teresa Tsai, GSC Capital Group, LLC
Under Negotiation: Price and terms of payment
P. Property: 5129 Bleecker Street (CAN 17-16)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Michael Daniel Healy and Chad Everett LaChance,
High Point Distribution, Inc.
Under Negotiation: Price and terms of payment
Q. Property: 5157 Azusa Canyon Road (CAN 17-17)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Mike Sandoval and Ed Barraza, Elite Green Cultivators
Under Negotiation: Price and terms of payment
R. Property: 5175 Commerce Drive (CAN 17-18)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Linda Thong, Pacific Cultivation, LLC
Under Negotiation: Price and terms of payment
S. Property: 14808 Arrow Highway (CAN 17-19)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Behnam Rodd, Jasper Rodd, and Luis Franco, Emerald
Connection, LLC
Under Negotiation: Price and terms of payment
T. Property: 13409 Garvey Ave. (CAN 17-20)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Valentina Ambarchyan, Edvin Sanatgar, and Robert Harutyunyan,
Checkpoint Distribution, Inc.
Under Negotiation: Price and terms of payment
U. Property: 428 Cloverleaf Drive (CAN 17-21)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Steve Yazeji, SCS Processing, Inc.
Under Negotiation: Price and terms of payment
V. Property: 15115 Ramona Blvd. AND 15004 Ramona Blvd. (CAN 17-22)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Rogelio Magana, Rancho Adelanto Development Enterprises
Under Negotiation: Price and terms of payment
W. Property:
Agency Negotiators
Negotiating Parties
Under Negotiation
14712 Arrow Highway (CAN 17-23)
Shannon Yauchzee, Chief Executive Officer
Robert Tafoya, City Attorney
Steve Chan, Manuel Suarez, and Gershom
Folks, Inc.
Price and terms of payment
and
Luh, The Grown
X. Property: 13450 Brooks Drive, Units A and C (CAN 17-24)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Anthony Samuel and AvShalom Cohen, NRD, LLC
Under Negotiation: Price and terms of payment
Y. Property: 13460 Brooks Drive (CAN 17-25)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Ruben Kachian, Vertical Bliss, Inc. (Kushy Punch)
Under Negotiation: Price and terms of payment
Z. Property: 4802 Littlejohn Street (CAN 17-26)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Rodolfo Aguilar, SGV Caregivers, Inc.
Under Negotiation: Price and terms of payment
AA. Property: 13450 Brooks Drive, Units A and C (CAN 17-27)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Jonathan Yuan Kai, Jefferson Liou, and Jerrell Austin Shepp,
Cloud Control, Inc.
Under Negotiation: Price and terms of payment
BB. Property: 4802 Littlejohn Street (CAN 17-28)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Marco Perez and Ren Yoneyama, VRD, Inc.
Under Negotiation: Price and terms of payment
CC. Property: 4276 Elton Street (CAN 17-29)
(APNs: 8437-016-005, 8437-016-015, and 8437-016-016)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Yichang Bai, W&F International Corporation
Under Negotiation: Price and terms of payment
DD. Property: 14726 Arrow Highway (CAN 17-30)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Anthony Willoughby, Tier One Consulting
Under Negotiation: Price and terms of payment
EE. Property: 13460 Brooks Drive (CAN 17-31)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: Sigrid Lopez and Artern Karapetyan, Green Health Industries,
LLC
Under Negotiation: Price and terms of payment
FF. Property: 5151 Azusa Canyon Rd. (CAN 17-32)
Agency Negotiators: Shannon Yauchzee, Chief Executive Officer, and
Robert Tafoya, City Attorney
Negotiating Parties: David Morgan, Jorge Garcia, Paul Granada, Fausto Alex Chavez,
Electric Atom Distribution
Under Negotiation: Price and terms of payment
RECONVENE IN OPEN SESSION
ADJOURNMENT
CERTIFICATION
I, Alejandra Avila, City Clerk of the City of Baldwin Park hereby that, certify under penalty of
perjury under the laws of the State of California, the foregoing agenda was posted on the City
Hall bulletin board not less than 24 hours prior to the meeting on December 18, 2017.
d�
,y Rf„
Alejandra Avila
City Clerk
PLI�
..... ..AEE NOTE': Copies of staff relrorts and supporting documentation pertaining to each item oil this agenda are
awidable for public viewing and inspection at City Hall, 21111 Floor Lobby Area or at the Los Angeles County Public Library
in tyre City of Baldwin Park Form further information regarding agenda items, please contact the office of the City Clark at
(828) 960-4011 ext 488 or, e. -mall actyila cr lrzrt;t' rr�2arjk.cgrn,
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please
contact the Public Works Depar°tn°rent or Rask Management at (828) 980-4011. Notification 48 hours prior to the meeting
will enable staff to make reasonable arrangements to ensure accessibility to this meeting. (28 CFR 34.102.104 ADA
TITLE 11)
NOTICE CALL
OF A
SPECIAL MEETING
OF THE
CITY COUNCIL
TO THE MEMBERS OF THE AFOREMENTIONED AGENCIES AND THE CITY CLERK OF
THE CITY OF BALDWIN PARK
NOTICE IS HEREBY GIVEN that a Special Meeting is hereby called to be held on
MONDAY, DECEMBER 18, 2017 at 7:30 PM at City Hall — Council Chambers, 14403 East
Pacific Avenue, Baldwin Park, CA 91706.
Said Special Meeting shall be for the purpose of conducting business in accordance with
the attached Agenda.
NO OTHER BUSINESS WILL BE DISCUSSED
Dated: December 14, 2017
AFFIDAVIT OF POSTING
/V1
Manuel Lozano
Mayor
I, Alejandra Avila, City Clerk of the City of Baldwin Park hereby that, certify under penalty of
perjury under the laws of the State of California, the foregoing agenda was posted on the City
Hall bulletin board not less than 24 hours prior to the meeting on December 18, 2017.
Alejandra Avila
City Clerk
BALDWIN PARK
CITY COUNCIL
SPECIAL CIAL ETI G
DECEMBER 18, 2017
7:30 P
CITY HALL - COUNCIL CHAMBERS
14403 EAST PACIFIC AVENUE
BALDWIN PARK, CA 91706
(626) 960-4011
Manuel Lozano
- Mayor
Ricardo Pacheco
- Mayor Pro Tem
Cruz Baca
- Council member
Monica Garcia
- Council member
Susan Rubio
- Council member
PLEASE TURN OFF CELL PHONES AND PAGERS WHILE MEETING IS IN PROCESS
POR FA VOR DE APA GAR SUS TELEFONOS CELULARES Y BEEPERS DURANTE LA JUNTA
PUBLIC COMM...
ENTS
The public is encouraged to address the City
Council or any of its Agencies listed on this
agenda, but only on any matter posted on this
agenda. If you wish to address the City Council
or any of its Agencies, you may do so during the
PUBLIC COMMUNICATIONS period noted on
the agenda. Each person is allowed three (3)
minutes speaking time. A Spanish-speaking
available ir�t��r�eter
foryour convenience,
�s
COMENTARIOS DEL PUBLICO
Se invita al publico a dirigirse al Concilio o cualquiera
otra de sus Agencias nombradas en esta agenda,
para hablar solamente sobre asunto publicado en esta
agenda. Si usted desea la oportunidad de dirigirse al
Concilio o alguna de sus Agencias, podrJ hacerlo
durante el periodo de Comentarios del Publico
(Public Communications) anunciado en la agenda. A
cads persona se le permite hablar por tres (3)
_a —�.. niencia.
mmutos. Hay_, mtd ret ���r�� su conve , ym__ ___
CITY COUNCIL
SPECIAL MEETING — 7:30 P.M.
CALL TO ORDER
INVOCATION
PLEDGE OF ALLEGIANCE
ROLL CALL
Council Members: Cruz Baca, Monica Garcia, Susan Rubio,
Mayor Pro Tem Ricardo Pacheco and Mayor Manuel Lozano
ANNOUNCEMENTS
PUBLIC COMMUNICATIONS
Three (3) minute speaking time limit
Tres (3) minutos ser6 el limite para hablar
THIS IS THE TIME SET ASIDE TO ADDRESS THE CITY COUNCIL
PLEASE NOTIFY THE CITY CLERK IF YOU REQUIRE THE SERVICES OF AN INTERPRETER
No action may be taken on a matter unless it is listed on the agenda, or unless certain emergency or special circumstances
exist. The legislative body or its staff may: 1) Briefly respond to statements made or questions asked by persons; or 2) Direct
staff to investigate and/or schedule matters for consideration at a future meeting. [Government Code §54954.2]
ESTE ES EL PERIODO DESIGNADO PARA DIRIGIRSE AL CONCILIO
FAVOR DE NOTIFICAR A LA SECRETARIA SI REQUIERE LOS SERVICIOS DEL INTERPRETE
No se podra tome acci6n en algun asunto a menos que sea incluido en la agenda, o a menos que exists alguna emergencia o
circunslancia especial. El cuerpo legislativo y su personal podran: 1) Responder brevemente a doclaraci6nes o preguntas
hechas por personas; o 2) Dirlgir personal a invostigar y/o fijar° asuntos para for ar on consideraci6n era ,juntas proximas.
[Codigo de Gobiemo §54954.2]
REPORTS OF OFFICERS
1. A REQUEST FOR THE CONSIDERATION OF APPROVAL OF DEVELOPMENT
AGREEMENTS FOR COMMERCIAL USE OF CANNABIS (MANUFACTURING,
CULTIVATION, AND DISTRIBUTION)
Staff recommends that Council select and then direct the City Attorney to negotiate
Development Agreements with qualified applicants for Commercial Cannabis
Manufacturing, Cultivation, and Distribution business enterprises.
ADJOURNMENT
CERTIFICATION
1, Alejandra Avila, City Clerk of the City of Baldwin Park hereby that, certify under penalty of
perjury under the laws of the State of California, the foregoing agenda was posted on the City
Hall bulletin board not less than 24 hours prior to the meeting on December 18, 2017.
Alejandra Avila
City Clerk
PLEASE NOTE,, Copies of staff mi'mris and supporting docurneototion pertaining to each item on this agenda are
i,,i variable for public viewing and inspection at City Hall, 2111J Floor Lobby, Area or at the Los Angeles County Public Library
in the City of Baldwin Park. For further information regarding agenda items, please contact the office of the City Clerk at
(626) 960-4011 ext. 466 or e-mail ityviLtifibl&,iLc(��
gjpgt&. r_
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please
contact the Public Works Department or Risk Management at (626) 960-4011. Notification 48 hours prior to the meeting
will enable staff to roake reasonable arrw7gements to ensure accessibility to this meeting, (28 CFR 34.102.104 ADA
TITLE //)
ITEM NO.
STAFF REPORT
TO: Honorable Mayor and City Councilmembers
e'' FROM: Robert N. Tafoya, City Attorney
SAN LiABRI L DATE: December 18, 2017
VALLEYS
SUBJECT: A REQUEST FOR THE CONSIDERATION OF APPROVAL OF
���" DEVELOPMENT AGREEMENTS FOR COMMERCIAL USE OF CANNABIS
(MANUFACTURING, CULTIVATION, AND DISTRIBUTION)
SUMMARY
This report seeks City Council consideration of the approval of Development Agreements with qualified
Applicants for Commercial Cannabis Manufacturing, Cultivation and Distribution.
FISCAL IMPACT
The expected revenue to the City is dependent on the number of permits issued and the development fees that
are negotiated but it could be as much as several million dollars per year after agreements get put in place and
the business prove successful.
RECOMMENDATION
Staff recommends that the City Council select and then direct the City Attorney to negotiate Development
Agreements with qualified applicants for Commercial Cannabis Manufacturing, Cultivation, and Distribution
business enterprises.
BACKGROUND/DISCUSSION
CALIFORNIA ENVIROr ' 1EW AI. Qt -'La 1.ml(:'7
In accordance with the provisions of the California Environment Quality Act (CEQA), CEQA is not applicable
to the approval of Development Agreements pursuant to Section 15061.13.3 as the Development Agreements
will not have the potential for causing a significant impact upon the environment. Since there is no possibility
that the activity in question may have a significant effect on the environment, the activity is not subject to
CEQA.
Cannabis Permit Development Agreements
December 6, 2017
Pap -e 2
Each community meeting was advertised by the City. It is important to note that there was no significant
opposition from any community members or residents at any of these informational meetings. At each of the
community meetings, a variety of staff and individuals in the cannabis community presented including the
following:
_ - „m. --- .-- ............................... ................ .............. ....._...........
PRESENTER TOPIC
...._._.�....m.Ex e e_.... m,,...t � . � .
. . _. .
Shannon Yauchzee, Chief Executive Officer Benefit to the community,Economic Development
......... .
Police Chief Police Department perspective, proposed security measures
Mike Taylor, Interim Poli c
Amy Harbin, City Planner Planning process, proposed conditions of approval,
additional public hearings, proposed zoning/locations
Robert Tafoya, City Attorney Legal background of issue
Overview on commercial cannabis businesses,
operations,
Various Industry leaders and experts on Cannabis cultivation, manufacturing and distribution Legal History
of Cannabis
LEGAL HISTORY OF CANNABIS
In 1996, the voters of the state of California approved Proposition 215 (codified as Health and Safety Code
Section 11362.5 and entitled "The Compassionate Use Act of 1996"). The intent of the Compassionate Use Act
("CUA") was to enable persons in need of marijuana for medical purposes to obtain and use marijuana without
the threat of criminal prosecution under limited and specific circumstances. Under the CUA, "qualified
caregivers" are exempted from being prosecuted under Health and Safety Code Section 11357 (possession of
marijuana) and 11358 (cultivation of marijuana) for specified amounts.
On January 1, 2004, the California State Legislature enacted Senate Bill 420 (the "Medical Marijuana Program
Act" or "MMPA") to clarify the scope of the CUA to allow cities and other governing bodies to adopt and to
enforce rules, regulations, and laws consistent with Senate Bill 420.
The California Supreme Court has made it clear that neither the CUA or MMPA expressly or impliedly
preempts the authority of cities or counties, under their traditional land use nor police powers, to allow, restrict,
limit or entirely exclude marijuana cultivation or distribution within their jurisdictions. The MMPA allows
cities and counties to adopt local ordinances that regulate the location, operation or establishment of medical
marijuana collectives and to enforce such ordinances. The safe distribution of marijuana, as contemplated by
the CUA and the safe the safe distribution of marijuana edibles should include consideration of the safety of all
residents and businesses, not just the users of marijuana or the consumer of marijuana edibles. The proposed
ordinance is designed to address safety and professional management in the operation of any proposed cannabis
business.
On October 9, 2015, the Governor signed three pieces of state legislation which comprise the "Medical
Marijuana Regulation and Safety Act" ("MMRSA"): Assembly Bill (AB) 266, Assembly Bill (AB) 243, and
Senate Bill (SB) 643.
1. AB 266 Establishes a dual licensing structure requiring a state license and a local license or land use
permit. The Department of Consumer Affairs will coordinate the overall regulatory structure
establishing minimum health and safety and testing standards.
Cannabis Permit Development Agreements
December 6, 2017
Page 3
2, AB 243 establishes a regulatory and licensing structure for cultivation sites under the Department of
Food and Agriculture.
3. SB 643 establishes criteria for licensing of medical marijuana businesses, regulates physicians, and
recognizes local authority to levy taxes and fees.
Generally and altogether, the MMSRA governs the licensing and control of all medical marijuana business in
the state and approves criminal immunity for licensees. The legislation protects local control in several ways: it
requires dual licensing; local governments may enforce state law in addition to local ordinance (upon request by
the local jurisdiction); and civil and criminal penalties are available for unlicensed activity.
PROPOS1110N 11100 64 AND ITS Ah-TEWlr ATH
In November 2016, California voters passed Proposition 64, hereafter referred to as the "Control, Regulate &
Tax Adult Use of Marijuana Act" ("AUMA"'), allowing the use and cultivation of recreational marijuana in
certain circumstances. On November 8, 2016, the AUMA was approved by California voters with the passage
of Proposition 64.
The AUMA legalizes for persons 21 years or older the right to: (1) smoke or ingest marijuana or marijuana
products; (2) possess, process, transport, purchase, obtain, give away without compensation to persons 21 years
or older, 28.5 grams of marijuana or 8 grams of concentrated marijuana; and (3) possess, plant, cultivate,
harvest, dry, or process up to six (6) living marijuana plants per legal dwelling unit for personal use.
The AUMA permits local jurisdictions to reasonably regulate, but not ban, indoor cultivation of up to six living
marijuana plants within a private residence for personal use. Private residences include a house, apartment unit,
mobile home, or similar dwelling unit. Permitted cultivation activities are not limited to the residence, but may
also: be hi a greenlIouse on the sane property, provided it is fully enclosed, sectire, and not visible from a pttblic
space. Sawking remains illegal 'vv,hile driving a vehicle, anywhere where smoking tobacco is illegal, and in all
public spaces.
Businesses may sell cannabis for recreational use by acquiring a state and local license. However, under the
existing zoning and regulatory Ordinances, all alis ensaies reina nurobibited in Baldwin Park
The measure creates two new taxes, one on cultivation and the other on retail price. Revenues from these taxes
will be used on research, treatment, enforcement, health and safety grants addressing marijuana, youth
programs, and preventing environmental damage caused by illegal cannabis production. The tax is $9.25 per
ounce for flowers and $2.75 per ounce for leaves, with the exception of some medical marijuana sales and
cultivation. The second is a 15 percent tax on the retail price of marijuana. Taxes will be adjusted for inflation
starting in 2020.
The United States Justice Department, in 2013, proclaimed it would not target lawful marijuana businesses or
cannabis use in states that legalized marijuana use and also enacted and enforced "robust" regulations
permitting marijuana industries. Local jurisdictions are permitted to regulate and ban outdoor cultivation, until
such time as the United States Attorney General determines that the use of non-medical marijuana is lawful'in
California under Federal law.
Cannabis Permit Development Agreements
December 6, 2017
Pap -e 4
Additionally, the AUMA creates a California regulatory and licensing system governing the commercial
cultivation, testing, distribution, transportation, manufacturing, and sale of non-medical marijuana and non-
medical marijuana products. No firm timeframe has been established for this licensing system, however,
January 1, 2018, has been indicated as the date by which the State will begin to issue licenses. Additionally;
under the AVMA, the State will have a comprehensive regulatory system for commercial .activities (versus
personal) related to non-medical marijuana. The State-run Bureau of Marijuana Control, currently known as the
Bureau of Medical Cannabis Regulation, will have primary oversight for enforcing the AVMA. A State
marijuana license will be valid for one year. A separate State license will be required for each commercial
marijuana business location. With the exception of testing facilities, any person or entity licensed under
AUMA may apply for and be issued more than one type of State license.
On April 28, 2017, the State released draft regulations for businesses to track medical marijuana and medical
marijuana products from seed to sale, for how medical marijuana can be transported, and ,required security
measures for medical marijuana dispensaries. The comment period is a minimum of 45 days and staff
anticipates it will take some time before the regulations are finalized. Additionally, the Bureau of Medical
Cannabis Regulation is in the process of developing the State's first Cannabis Advisory Committee, which will
help to finalize regulations for medical and non-medical marijuana. As of May 2017, there were 56 pending
State laws regarding marijuana.
MEDICAL ANDADULT-USECA.NNABI.S REGULATION AND SAFETYACT
Recently, the Governor signed a new bill, SB 94, entitled the "Medical and Adult -Use Cannabis Regulation and
Safety Act" ("MAUCRSA"), which took effect immediately. MAUCRSA melds the State's medical -only
regulations passed by the legislature (a.k.a. MCRSA) with the adult -use rules approved by the voters under
Prop. 64. For the most part, MAUCRSA follows the more flexible, industry -friendly rules of AUMA, such as
allowing applicants to get licenses in different phases of the industry—cultivation, manufacture, distribution
and retailing -W rather than restrict so-called "vertical integration" by allowing List a single kind of license, a
Lind& MCRSA. .. It also elitninales MC1 SA's independent distributor requiremeril, authorizes the issuance of
temporary special -event licenses, and drops the California residency requirement for license applicants.
Under MAUCRSA, applicants have the choice of applying for a medical "Type M" or adult -use "Type A"
license in any category (cultivating, manufacture, etc.). It requires medical and adult -use businesses to operate
separately, however a provision to allow co -location of adult and medical use facilities has been incorporated in
a separate regulatory clean-up bill. AB 64 would; (1) allow medical and adult -use licenses to operate on' the
same premises; (2) amend California's Model State Trademark Law to allow trademarks for cannabis products;
and (3) allow existing medical collectives, which must still operate as not -for -profits under SB 420 pending
state regulation, to operate on a for-profit basis immediately.
Currently, California Business & Professions Code §26000, et seq., provides the State's comprehensive system
to control and regulate the cultivation, distribution, manufacturing, processing, and sale of medical marijuana
and adult use marijuana for persons 21 years old and over.
(°ITY S REG 1,1I.ATION OF CANNA BA'
In addition to adding Medical and Adult Use Cannabis to Industrial and Industrial Commercial zones with a
Permit and Development Agreement, the City added Chapter 127 of Title XI of the Municipal Code. The
Cannabis Permit Development Agreements
December 6, 2017
Page 5
ordinance contains many safeguards to assure that the City and its citizens are protected and that any marijuana
licensees conduct their businesses safely. Among the safeguards are:
a) No manufacturing or cultivation site will be located with six hundred (600) feet of a school, daycare
center, or youth center. No manufacturing or cultivation site will be within fifty (50) feet of a residential
zone;
b) All manufacturing and cultivation sites will be limited to certain city Industrial (I) and Industrial
Commercial (IC) zones;
c) All manufacturing and cultivation will occur in enclosed, locked structures;
d) All manufacturing and cultivation sites, and operations therein, and all equipment used, must be in
compliance with all applicable state and local laws, including all building, electrical, and fire codes;
e) The use and storage of hazardous materials, including flammable gas, flammable liquefied gas, and
combustible materials, must comply with all the Fire Code standards;
f) All manufacture and cultivation sites are required to be fire sprinkled under the Fire Code standards;
g) From a public right-of-way, there should be no exterior evidence of the manufacture or cultivation of
cannabis, except for any authorized signage;
h) All transportation of cannabis must comply with state law;
i) High standards for granting permits, with many grounds for denial of a permit;
j) Requirements for security cameras to be installed and maintained on sites;
k) Alarm system requirements for sites;
1) Requirements that licensees implement a system to track the cultivation and manufacturing of cannabis,
in order to prevent the licensee from diverting or transporting cannabis to any location not authorized by
state law;
m) Video surveillance requirements;
n) All applicants must execute an agreement indemnifying the City from any claims, damages, injuries, or
liabilities of any kinds associated with operation of the marijuana facilities;
o) Requirements that the facilities maintain insurance, in amounts and types acceptable to the City,
including naming the City as an additional insured;
p) Requiring inspections by the Chief Executive Officer or his designee, law enforcement or their
designees, of the facilities;
q) Control and regulation of noxious odors; and
Cannabis Permit Development Agreements
December 6, 2017
Paee 6
r) Provide the City-wide powers to summarily suspend or revoke permits, or disqualify an applicant from
the registration process.
TIME IS OF THE ESSENCE
It is important that the City begin the processes related to permitting businesses to manufacture and cultivate
cannabis within its jurisdiction as soon as possible. The City has adopted an aggressive schedule to get the
ordinance effective because any cannabis businesses with a local permit and in operation by January 1,. 2018
will receive preferential treatment by the State when the State begins issuing licenses on January 1, 2018. If a
cannabis business does not have a local permit and be in operation by January 1, 2017, that business will go to
the back of the line for State permits and could wait 12-24 months after January 1, 2018 before getting a State
permit to operate. Therefore, it is critical to have the systems in place for selecting permittees and for issuing
permits by mid-September in order to allow our applicants to get "up and running" by January 1, 2018. It is
believed that the applicants will need several months to build their facility, install cameras and ventilation
systems and perform all the necessary tasks to allow the business to be "in operation."
REVENUE TO CITY
The expected revenue to the City is dependent on the number of permits issued and the development fees that
are negotiated but it could be as much as several million dollars per year after agreements get put in place and
the business prove successful.
The Application Process included the Planning Department's review of applications for completeness, a City
Stibconirnittee review of the Applications, and lina.ily negotiations for Devel rpment Agreements with the
Apl,rlicants for Manufacturing, Cultivation, and/or Distribution of Conim rcial Cannabis. After the
Subcommittee's review, the Applicants negotiated with the City Attorney's Office for terms of the
Development Agreement. A form Development Agreement is attached for public review. The City Council
reviewed the proposed terms of the Development Agreement; however, will not make any decision until the
Agreements are made public at this duly noticed public meeting. Consistent and pursuant to Chapter 127 of the
Baldwin Park Municipal Code Development Agreements must be approved by the City Council prior to
issuance of permits for commercial use of Cannabis for Manufacturing, Cultivation and/or Distribution.
LEGAL REVIEW
This report has been reviewed and approved by the City Attorney as to legal form and content.
ALTERNATIVES
Council may choose to set another meeting to consider the proposed Development Agreement; however the
deadline for approval is prior to January 1, 2018.
ATTACHMENTS
1. Form Development Agreement
DEVELOPMENT AGREEMENT
BY AND BETWEEN
THE CITY OF BALDWIN PARK AND
ARTICLE 1. PARTIES AND DATE.
This Development Agreement ("Agreement") is dated __.._..r 20
for references purposes only and is entered into between (i) the City of Baldwin Park
("City"), a California municipal corporation, and (ii) , a California
("Owner"). This Agreement shall become effective on the Effective Date defined in
Section 3.1.11 below.
ARTICLE 2. RECITALS.
2.1 WHEREAS, the City is authorized to enter into binding development
agreements with persons having legal or equitable interests in real property for the
development of such property; and
2.2 WHEREAS, Owner commenced its efforts to obtain approvals and
clearances to cultivate, manufacture, and distribute medical and adult use cannabis in
September 2017; and at that time the City determined that the uses authorized in this
Agreement were lawfully permitted and authorized to occur on Owner's Property,
subject to Owner's acquisition of various entitlements, as discussed herein; and
2.3 WHEREAS, Owner voluntarily enters into this Agreement and after
extensive negotiations and proceedings have been taken in accordance with the rules
and regulations of the City, Owner has elected to execute this Agreement as it provides
Owner with important economic and development benefits; and
2.4 WHEREAS, this Agreement and the Project are consistent with the City's
General Plan and Zoning Code and applicable provisions of the City's applicable Zoning
Map as of the Agreement Date; and
2.5 WHEREAS, all actions taken and approvals given by the City have been
duly taken or approved in accordance with all applicable legal requirements for notice,
public hearings, findings, votes, and other procedural matters; and
2.6 WHEREAS, this Agreement will eliminate uncertainty in planning and
provide for the orderly development of the Property, ensure progressive installation of
necessary improvements, and provide for public services appropriate to the
development of the Project; and
2.7 WHEREAS, in implementation of the promulgated state policy to promote
private participation in comprehensive planning and to strengthen the public planning
process and to reduce the economic risk of development, the City deems the
implementation of this Agreement to be in the public interest and intends that the
adoption of this Agreement be considered an exercise of the City's police powers to
regulate the development of the Property during the Term of this Agreement; and
2.8 WHEREAS, this Agreement is consistent with the public health, safety and
welfare needs of the residents of the City and the surrounding region and the.. City has
specifically considered and approved the impact and benefits of the development of the
Property in accordance with this Agreement upon the welfare of the region; and
2.9 WHEREAS, Owner intends to develop a Cannabis Cultivation Facility
pursuant to the Baldwin Park Municipal Code ("BPMC") Chapter 127 and all applicable
state laws, rules, and regulations; and
2.10 WHEREAS, concurrently with execution of this Agreement, City
acknowledges that Owner has been authorized to cultivate, manufacture, and distribute
cannabis and cannabis related products at its facility or facilities up to 22,000 square
feet.
ARTICLE 3. GENERAL TERMS.
3.1 Definitions and Exhibits. The following terms when used in this
Agreement shall be defined as follows:
corporation.
3.1.1 "Agreement" means this Development Agreement.
3.1.2 "City" means the City of Baldwin Park, a California municipal
3.1.3 "Days" mean calendar days unless otherwise specified.
3.1.4 "Dedicate" means to offer the subject land for dedication and to
post sufficient bonds or other security if necessary for the improvements to be
constructed including, but not limited to: grading, the construction of infrastructure and
public facilities related to the Project whether located within or outside the Property, the
construction of buildings and structures, and the installation of landscaping.
3.1.5 "Development" includes grading, construction or installation of
public and private facilities and the right to maintain, repair or reconstruct any private
building, structure, improvement or facility after the construction and completion thereof;
provided, however, that such maintenance, repair, or reconstruction take place within
the Term of this Agreement on the Property.
3.1.6 "Development Approvals" means all permits, licenses, and/or other
entitlements for the Development of the Property, including any and all conditions of
approval, subject to approval or issuance by the City in connection with Development of
the Property.
3.1.7 "Development Approvals" specifically include this Agreement.
"Development Approvals" also include both the Existing Development Approvals and
the Subsequent Development Approvals approved or issued by the City that are
consistent with this Agreement.
3.1.8 "Development Plan" means the Existing Development Approvals
and the Existing Land Use Regulations applicable to development of the Property for
the Project, as modified and supplemented by Subsequent Development Approvals.
3.1.9 "BPMC" means the City of Baldwin Park Municipal Code.
3.1.10 "Effective Date" means the day this Development Agreement is
approved and adopted by the Baldwin Park City Council.
3.1.11 "Existing Development Approvals" means all Development
Approvals approved or issued prior to or on the Effective Date. Existing Development
Approvals include the approvals set forth in Section 3.1.6 and all other approvals which
are a matter of public record prior to or on the Effective Date.
3.1.12 "Existing Land Use Regulations" means all Land Use Regulations
in effect on the Effective Date. Existing Land Use Regulations include all regulations
that are a matter of public record on the Effective Date as they may be modified by the
Existing Development Approvals.
3.1.13 "Land Use Regulations" means all ordinances, resolutions and
codes adopted by the City governing the development and use of land, including the
permitted use of land, the density or intensity of use, subdivision requirements, the
maximum height and size of proposed buildings, the provisions for reservation or
Dedication of land for public purposes, and the design, improvement and construction
and initial occupancy standards and specifications applicable to the Development of the
Property.
"Land Use Regulations" do not include any City or City -agency ordinance, resolution or
code governing any of the following:
(i) The conduct, licensing or taxation of businesses,
professions, and occupations;
residents of the City;
(ii) Taxes and assessments of general application upon all
(iii) The control and abatement of nuisances;
(iv) The granting of encroachment permits and the conveyance
of rights and interests that provide for the use of or the entry upon public property; and
(v) The exercise of the power of eminent domain.
3.1.14 "Mortgagee" means a mortgagee of a mortgage, a beneficiary
under a deed of trust or any other security -device lender and its successors -in interest.
3.1.15 "Owner" means _ a CA, and its permitted successors in
interest to all or any part of the Property.
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3.1.16 "Processing Fees" means the normal and customary application,
filing, plan check, permit fees for land use approvals, design review, tree removal
permits, building permits, demolition permits, grading permits, and other similar permits
and entitlements, and inspection fees, which fees are charged to reimburse the City's
expenses attributable to such applications, processing, permitting, review and
inspection and which are in force and effect on a general basis at such time as said
approvals, permits, review, inspection or entitlements are granted or conducted by the
City.
3.1.17 "Project" means the Development of the Property contemplated by
the Development Plan, as such Development Plan may be further defined, enhanced or
modified pursuant to the provisions of this Agreement. The Project shall consist of this
Agreement, the Development Plans, any and all entitlements licenses, and permits
related to the Project, any and all licenses.
3.1.18 "Property" means the real property described on Exhibit A and
shown on Exhibit B, both attached hereto and incorporated herein by this reference.
Owner may modify the location or locations of the Property subject to City approval and
all applicable zoning and distance requirements.
3.1.20.1 "Reasonable" means using due diligence to accomplish a stated
objective that the subject party is capable of performing or providing under the
circumstances in a manner that is consistent with the intent and objectives of the
Agreement.
3.1.19 "Reservations of Authority" means the rights and authority
excepted from the assurances and rights provided to Owner under this Agreement and
reserved to the City as described in Section 4.4.
3.1.20 "Space" shall mean any space or ground, floor or other surface
area (whether horizontal or vertical) which is used during the marijuana germination,
seedling, vegetative, pre -flowering, flowering and harvesting phases, including without
limitation any space used for activities such as growing, planting, seeding, germinating,
lighting, warming, cooling, aerating, fertilizing, watering, irrigating, topping, pinching,
cropping, curing or drying marijuana or any such space used for storing any products,
supplies or equipment related to any such activities, no matter where such storage may
take place or such storage space may be located.
3.1.21 "Subsequent Development Approvals" means all future
discretionary approvals and all ministerial Development Approvals required subsequent
to the Effective Date in connection with development of the Property, including without
limitation, subdivision improvement agreements that require the provision of bonds or
other securities. Subsequent Development Approvals include, without limitation, all
excavation, grading, building, construction, demolition, encroachment or street
improvement permits, occupancy certificates, utility connection authorizations; or other
permits or approvals necessary, convenient or appropriate for the grading, construction,
marketing, use and occupancy of the Project within the Property at such times and in
such sequences as Owner may choose consistent with the Development Plan and this
Agreement.
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3.1.22 "Subsequent Land Use Regulations" means any Land Use
Regulations defined in Section 4.4 that are adopted and effective after the Effective
Date -of this Agreement.
3.2 Exhibits. The following documents are attached to and, by this
reference, made part of this Agreement:
Exhibit A — Legal Description of the Property.
Exhibit B — Map showing Property and its location.
3.3 Binding Effect of Agreement. The Property is hereby made subject to
this
Agreement. Subject to Owner's receipt of all Development Approvals relative thereto,
the Development of the Property is hereby authorized and shall, except as otherwise
provided in this Agreement, be carried out only in accordance with the terms of this
Agreement and the Development Plan. In the event of conflict or uncertainty between
this Agreement and the Development Plan, the provisions of this Agreement shall
control.
3.4 Ownership of Property. Owner represents and covenants that it has a legal
or equitable interest in the Property, which has an Assessor's Parcel Number of
and is more particularly described in Exhibit A attached hereto and
incorporated herein.
3.5 Term. The parties agree that the Term of this Agreement shall be fifteen
(15) years commencing on the Effective Date subject to the extension and early
termination provisions described in this Agreement, with the Term subject to possible
tolling pursuant to Section 11.10 of this Agreement. Upon termination of this
Agreement, this Agreement shall be deemed terminated and of no further force and
effect without the need of further documentation from the parties hereto. The
Agreement's Mitigation Fee is subject to renegotiation after every five years.
3.5.1 Term Extension. This Agreement may be extended by mutual
agreement of City and Owner in writing and signed by Owner and the Mayor of Baldwin
Park.
3.6 Automatic Termination. This Agreement shall automatically terminate
upon the occurrence of any of the following events:
(i) Expiration of the Term of this Agreement as set forth in
Section 3.5;
(ii) The entry of a final judgment (or a decision on any appeal
therefrom) voiding the City's General Plan or any element thereof, which judgment or
decision would preclude development of the Project, but only if the City is unable to cure
such defect in the General Plan or element within one hundred and eighty (180) days
from the later of entry of final judgment or decision on appeal.
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3.6.1 Effect of Termination. Termination of this Agreement shall
constitute termination of all land use entitlements approved for the Property. Upon the
termination of this Agreement, no party shall have any further right or obligation
hereunder except with respect to any obligation to have been performed prior to such
termination, or with respect to any default in the performance of the provisions of this
Agreement which has occurred prior to such termination, or with respect to any
obligations which are specifically and expressly set forth as surviving this Agreement.
3.7 Notices.
3.7.1 Notice Defined. As used in this Agreement, notice includes, without
limitation, the communication of notice, request, demand, approval, statement, report,
acceptance, consent, waiver, appointment or other communication required or permitted
hereunder.
3.7.2 Written Notice and Delivery. All notices shall be in writing and shall
be considered given:
(i) when delivered in person to the recipient named below; or
(ii) three days after deposit in the United States mail, postage
prepaid, addressed to the recipient named below; or
(iii) on the date of delivery shown in the records of the delivery
company after delivery to the recipient named below; or
(iv) on the date of delivery by facsimile transmission to the
recipient named below if a hard copy of the notice is deposited in the United States
mail, postage prepaid, addressed to the recipient named below. All notices shall be
addressed as follows:
If to the City: Chief Executive Officer
14403 E. Pacific Avenue
Baldwin Park, CA 91706
If to Owner:
3.7.3 Address Changes. Either party may, by notice given at any time,
require subsequent notices to be given to another person or entity, whether a party or
an officer or representative of a party or to a different address, or both. Notices given
before actual receipt of notice of change shall not be invalidated by the change.
3.8 Validity of this Agreement. Owner and the City each acknowledge that
neither party has made any representations to the other concerning the enforceability
or validity of any one or more provisions of this Agreement. The parties acknowledge
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and agree that neither party shall allege in any administrative or judicial proceeding
that the entering into or the performance of any obligations created in this Agreement
violates federal or state law, with respect to all federal, state and local statutes,
ordinances or regulations in effect as of the Effective Date.
ARTICLE 4. DEVELOPMENT OF THE PROPERTY.
4.1 Right to Develop. Owner shall, subject to the terms of this Agreement,
develop the Property with a commercial cannabis facility in accordance with and to
the extent of the Development Plan. The Property shall remain subject to all
Subsequent Development Approvals required to complete the Project as
contemplated by the Development Plan.
4.2 Effect of Agreement on Land Use Regulations. Except as otherwise
provided by this Agreement, the rules, regulations and official policies and conditions
of approval governing permitted uses of the Property, the density and intensity of use
of the Property, the maximum height and size of proposed buildings, and the design,
improvement, occupancy and construction standards and specifications applicable to
development of the Property shall be the Development Plan. Provided, however, that
in approving tentative subdivision maps, the City may impose ordinary and necessary
dedications for rights-of-way or easements for public access, utilities, water, sewers
and drainage, having a nexus with the particular subdivision; provided, further, that
the City may impose and will require normal and customary subdivision improvement
agreements and commensurate security to secure performance of Owner's
obligations thereunder.
4.3 Changes to Project. The parties acknowledge that changes to the
Project or Development Approvals may be appropriate and mutually desirable. The
City shall act on such applications, if any, in accordance with the Existing Land Use
Regulations, subject to the Reservations of Authority, or except as otherwise
provided by this Agreement. If approved, any such change in the Existing
Development Approvals shall be considered an additional Existing Development
Approval.
4.4 Reservations of Authority. Any other provision of this Agreement to the
contrary notwithstanding, the Development of the Property shall be subject to
subsequently adopted ordinances, resolutions ("Subsequent Land Use Regulations"
or sometimes referred to as "Reservation of Authority") on the following topics:
(i) Processing Fees imposed by the City to cover the estimated or
actual costs to the City of processing applications for Development Approvals or for
monitoring compliance with any Development Approvals granted or issued, which fees
are charged to reimburse the City's lawful expenses attributable to such applications,
processing, permitting, review and inspection and which are in force and effect on a
general basis at such time as said approvals, permits, review, inspection or entitlement
are granted or conducted by the City.
(ii) Procedural regulations relating to hearing bodies, petitions,
applications, notices, findings, records, hearings, reports, recommendations, appeals
and any other matter of procedure.
(iii) Regulations governing engineering and construction standards and
specifications including, any and all uniform codes adopted by the State of California
and subsequently adopted by the City.
(iv) Regulations which may be in conflict with the Development Plan but
which are reasonably necessary to protect the public health and safety; provided,
however, the following shall apply:
(a) That to the extent possible, such regulations shall be applied
and construed so as to provide Owner with the rights and assurances provided in this
Agreement;
(b) That such regulations apply uniformly to all new
development projects of the same uses within the City; and
(v) Regulations that do not conflict with the Development Plan. The
term "do not conflict" means new rules, regulations, and policies which: (a) do not
modify the Development Plan, including, without limitation, the permitted land uses, the
density or intensity of use, the phasing or timing of Development of the Project, the
maximum height and size of proposed buildings on the Property, provisions for
Dedication of land for public purposes and Development Exactions, except as expressly
permitted elsewhere in this Agreement, and standards for design, development and
construction of the Project; (b) do not prevent Owner from obtaining any Subsequent
Development Approvals, including, without limitation, all necessary approvals, permits,
certificates, and the like, at such dates and under such circumstances as Owner would
otherwise be entitled by the Development Plan; or (c) do not prevent Owner from
commencing, prosecuting, and finishing grading of the land, constructing public and
private improvements, and occupying the Property, or any portion thereof, all at such
dates and schedules as Owner would otherwise be entitled to do so by the
Development Plan.
(vi) The City shall not be prohibited from applying to the Project
Subsequent Land Use Regulations that do not affect permitted uses of the land, 'density,
design, public improvements (including construction standards and specifications) or the
rate of development of the Development, nor shall the City be prohibited from denying
or conditionally approving any Subsequent Development applications on the basis of
such subsequent Land Use Regulations.
4.5 Other Public Agencies. It is acknowledged by the parties that other
public agencies not within the control of the City possess authority to regulate
aspects of the development of the Property separately from or jointly with the City,
and this Agreement does not limit the authority of such other public agencies. The
City shall reasonably cooperate with other public agencies processing Development
Approvals for the Project.
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4.6 Tentative Subdivision Map and Development Approvals Lifespan. The
term of any tentative subdivision map shall be in effect for a period of ten (10) years,
and may be extended pursuant to the provisions of the California Subdivision Map
Act (Government Code §§ 66410 et seq.) All Development Approvals shall not expire
if Owner commences substantial construction of the Project within three (3) years
from the Effective Date of this Agreement. "Substantial Construction" means the
issuance of a building permit in furtherance of the Project.
4.7 Satisfaction of Conditions of Approval. Owner shall comply with any
and all conditions of approval for any entitlement, permit, or license it receives from
the City.
4.8 Subsequent Entitlements. Prior to commencement of construction of
the Project, Owner shall be required to submit applications for any and all subsequent
entitlements, if any, consistent with the terms and conditions set forth in this
Agreement.
4.9 City Records Inspection. Owner acknowledges and agrees that the City
is empowered to examine Owner's books and records, including tax returns. The City
has the power and authority to examine such books and records at any reasonable
time, including but not limited to, during normal business hours. If the City wishes to
inspect the areas of the Property where the cannabis is being cultivated, City must
provide Owner written notice, with such notice being provided in a reasonable time,
requesting entry into the cultivation, manufacturing, distribution and curing areas. In
addition, City agrees that all of its employees or agents which enter the cultivation
and curing areas shall follow all of the policies and guidelines imposed on Owner's
employees, including without limitation, the wearing of any clothing or equipment to
insure that no pests or impurities shall enter the cultivation and curing areas.
ARTICLE 5. PUBLIC BENEFITS.
5.1 Intent. The parties acknowledge and agree that development of the
Property will result in substantial public needs which will not be fully met by the
Development Plan and further acknowledge and agree that this Agreement confers
substantial private benefits on Owner which should be balanced by commensurate
public benefits. Accordingly, the parties intend to provide consideration to the public
to balance the private benefits conferred on Owner by providing more fully for the
satisfaction of the public needs resulting from the Project.
5.2 For the first year, Owner will pay the City a total of $220,000 as a
Mitigation Fee. This fee is calculated based on $10.00 a square foot of permit space
and a permit which allows up to 22,000 sq. feet.
5.3 In year two and year three, the Mitigation Fee will increase to $12.50
per sq. foot for a total of $275,000 per year
5.4 At the beginning of year four and year five, Owner will pay a Mitigation
Fee of $15.00 per sq. foot for a total of $330,000 per year.
in
5.5 The Mitigation Fee schedule is as follows: payment is due at the close
of each quarter. Therefore, the first payment will be due on the last day of March, the
second payment due on the last day of June, the third payment due on the last day of
September, and the final payment due by the last day of December.
5.6 The Mitigation Fee is subject to reassessment by the City every five
years. At the end of year five, the City will set a new per sq. ft. rate as applied in
years 6 through 10. At the end of year 10, the City will set new per sq. ft. rate as
applied in years 11 through 15. The City may take into consideration various factors
including, but not limited to, current market conditions, and the Owner's unique
circumstances. However, no one factor is dispositive in the City's determination of
the per sq. ft. rate. The Medical Cannabis permit will expire at the close of the 15th
year and will require the Owner to reapply with the City for a new permit.
5.7 Further, Owner will pay a yearly payment of $50,000 to the City that can
be used to pay a part of a police officer's salary and benefits. This $50,000 amount
will be due at the time the permit is issued. Subsequent annual payments will be due
on the permit issuance anniversary date.
5.8 Jobs and Wage Creation.
5.8.1 Local Hiring. Owner agrees to use its reasonable efforts to hire
qualified City residents for jobs at the Project. Owner shall also use reasonable efforts
to retain the services of qualified contractors and suppliers who are located in the City
or who employ a significant number of City residents. At least 0 ercent of the Pro'ect"s
workforce shall consist of residents of Lheity. Job announcements shall be posted at
City Hall, along with proof that the job announcements were advertised in at least two
newspapers published, printed or distributed in the City and on various social media sites
accessible to the general public. In addition, Owner shall make a good faith effort to
advertise job announcements at local job fairs, on local radio and through public agencies
and organizations.
5.9 Development Agreement Administrative Fee Deposit. Owner shall be
responsible for all of the City's actual costs associated with processing Development
Approvals for the Project including, but not limited to, costs associated with the City's
review and processing of the Project, including but not limited to reviewing the
Project's entitlements, including all environmental clearance documents, permits,
licenses and all documents evidencing compliance with state and local law. As such,
Owner must deposit $15,000 with the City for the purpose of reimbursing the City for
any associated costs with processing the Project, as detailed above and reimbursing
the City for its actual costs incurred in drafting and processing this Agreement.
Owner will not be liable for the City's actual costs incurred in processing future
Development Approval applications. City acknowledges and agrees that this
payment is not merely a deposit, but is a cap on the amount of the City's actual costs
incurred in processing this Agreement.
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ARTICLE 6. [RESERVED]
ARTICLE 7. REVIEW FOR COMPLIANCE.
7.1 Periodic Review. The City Council shall review this Agreement
annually, on or before each anniversary of the Effective Date, in order to ascertain
Owner's good faith compliance with this Agreement. During the periodic review,
Owner shall be required to demonstrate good faith compliance with all the terms of
the Agreement.
7.2 Special Review. The City Council may order a special review of
compliance with this Agreement at any time, if the City determines that Owner is in
breach of this Agreement.
7.3 Review Hearing. At the time and place set for the review hearing,
Owner shall be given an opportunity to be heard. If the City Council finds, based
upon substantial evidence, that Owner has not complied in good faith with the terms
or conditions of this Agreement, the City Council may terminate this Agreement
notwithstanding any other provision of this Agreement to the contrary, or modify this
Agreement and impose such conditions as are reasonably necessary to protect the
interests of the City. The decision of the City Council shall be final, subject only to
judicial review.
7.4 Certificate of Agreement Compliance. If, at the conclusion of a periodic
or special review, the City Council determines that Owner is in compliance, with this
Agreement, the City shall issue a Certificate of Agreement Compliance ("Certificate")
to Owner stating that after the most recent periodic or special review, and based
upon the information known or made known to the City Council, that (i) this
Agreement remains in effect and (ii) Owner is not in default. The City shall not be
bound by a Certificate if a default existed at the time of the periodic or special review,
but was concealed from or otherwise not known to the City Council, regardless of
whether or not the Certificate is relied upon by assignees or other transferees or
Owner.
7.5 Failure to Conduct Review, The City's failure to conduct a sodic
review of this Agrment shall not constitute a beach of this A ire�°nent.
7.6 Cost of Review. The costs incurred by City in connection with the
periodic reviews shall be borne by the City. The Owner is not liable for any costs
associated with any City periodic review of this Agreement. The Owner is not liable
for costs incurred for reviews.
ARTICLE 8. DEFAULTS AND REMEDIES.
8.1 Remedies in General. It is acknowledged by the parties that the City
would not have entered into this Agreement if it were to be liable in damages under
this Agreement, or with respect to this Agreement or the application thereof, except
as hereinafter expressly provided. Subject to extensions of time by mutual consent in
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writing, failure or delay by either party to perform any term or provision of this
Agreement shall constitute a default. In the event of alleged default or breach of any
terms or conditions of this Agreement, the party alleging such default or breach shall
give the other party not less than thirty (30) days' notice in writing specifying the
nature of the alleged default and the manner in which said default may be
satisfactorily cured during any such thirty (30) day period, the party charged shall not
be considered in default for purposes of termination or institution of legal
proceedings. Notwithstanding the foregoing to the contrary, if the alleged default is of
such a nature that it cannot be cured within thirty (30) days, the alleged defaulting
party shall not be deemed in default as long as such party commences to cure such
default within such thirty (30) day period and thereafter diligently prosecutes such
cure to completion.
In general, each of the parties hereto may pursue any remedy at law or equity available
for the breach of any provision of this Agreement through any state court, except that
the City shall not be liable in monetary damages, unless expressly provided for in this
Agreement, to Owner, to any mortgagee or lender, or to any successors in interest of
Owner or mortgagee or lender, or to any other person, and Owner covenants on behalf
of itself and all successors in interest to the Property or any portion thereof, not to sue
for damages or claim any damages:
(i) For any breach of this Agreement or for any cause of action which
arises out of this Agreement; or
(ii) For the impairment or restriction of any right or interest conveyed or
provided under, with, or pursuant to this Agreement, including, without limitation, any
impairment or restriction which Owner characterizes as a regulatory taking or inverse
condemnation; or
(iii) Arising out of or connected with any dispute, controversy or issue
regarding the application or interpretation or effect of the provisions of this Agreement.
Nothing contained herein shall modify or abridge Owner's rights or remedies (including
its rights for damages, if any) resulting from the exercise by the City of its power of
eminent domain. Nothing contained herein shall modify or abridge Owner's rights or
remedies (including its rights for damages, if any) resulting from the grossly negligent or
malicious acts of the City and its officials, officers, agents and employees. Nothing
herein shall modify or abridge any defenses or immunities available to the City and its
employees pursuant to the Government Tort Liability Act and all other applicable
statutes and decisional law.
Except as set forth in the preceding paragraph relating to eminent domain, Owner's
remedies shall be limited to those set forth in this Section 8.1, Section 8.2, and
Section 8.3.
Notwithstanding anything to the contrary contained herein, the City covenants as
provided in Civil Code Section 3300 not to sue for or claim any consequential damages
or, in the event all or a portion of the Property is not developed, for lost profits or
in
revenues which would have accrued to the City as a result of the development of the
Property.
8.2 Specific Performance. The parties acknowledge that money damages
and remedies at law are inadequate, and specific performance and other non -
monetary relief are particularly appropriate remedies for the enforcement of this
Agreement and should be available to all parties for the following reasons:
(i) Except as provided in Sections 8.1 and 8.5, money damages are
unavailable against the City as provided in Section 8.1 above.
(ii) Due to the size, nature and scope of the Project, it may not be
practical or possible to restore the Property to its natural condition once implementation
of this Agreement has begun. After such implementation, Owner may be foreclosed
from other choices it may have had to use the Property or portions thereof. Owner has
invested significant time and resources and performed extensive planning and
processing of the Project in agreeing to the terms of this Agreement and will be
investing even more significant time and resources in implementing the Project in
reliance upon the terms of this Agreement, and it is not possible to determine the sum of
money which would adequately compensate Owner for such efforts; the parties
acknowledge and agree that any injunctive relief may be ordered on an expedited,
priority basis.
8.3 Termination of Agreement for Default of the City. Owner may terminate
this Agreement only in the event of a default by the City in the performance of a
material term of this Agreement and only after providing written notice to the City of
default setting forth the nature of the default and the actions, if any, required by the
City to cure such default and, where the default can be cured, the City has failed to
take such actions and cure such default within sixty (60) days after the effective date
of such notice or, in the event that such default cannot be cured within such sixty
(60) day period but can be cured within a longer time, has failed to commence the
actions necessary to cure such default within such sixty (60) day period and to
diligently proceed to complete such actions and cure such default. In such a
situation, notwithstanding the termination of this Agreement, all Development
Approvals shall remain in full force and effect.
8.4 Attorneys' Fees and Costs. In any action or proceeding between the
City and Owner brought to interpret or enforce this Agreement, or which in any way
arises out of the existence of this Agreement or is based upon any term or provision
contained herein, the "prevailing party" in such action or proceeding shall be entitled
to recover from the non -prevailing party, in addition to all other relief to which the
prevailing party may be entitled pursuant to this Agreement, the prevailing party's
reasonable attorneys' fees and litigation costs, in an amount to be determined by the
court. The prevailing party shall be determined by the court in accordance with
California Code of Civil Procedure Section 1032. Fees and costs recoverable
pursuant to this Section 9.4 include those incurred during any appeal from an
underlying judgment and in the 'enforcement of any judgment rendered in any such
action or proceeding.
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8.5 Owner Default. No building permit shall be issued or building permit
application accepted for any structure on the Property after Owner is determined by
the City to be in default of the terms and conditions of this Agreement until such
default thereafter is cured by Owner or is waived by the City. If the City terminates
this Agreement because of Owner's default, then the City shall retain any and all
benefits, including money or land received by the City hereunder.
ARTICLE 9. THIRD PARTY LITIGATION.
9.1 General Plan Litigation. The City has determined that this Agreement is
consistent with its General Plan. Owner has reviewed the General Plan and concurs
with the City's determination. The City shall have no liability under this Agreement or
otherwise for any failure of the City to perform under this Agreement, or for the
inability of Owner to develop the Property as contemplated by the Development Plan,
which failure to perform or inability to develop is as the result of a judicial
determination that the General Plan, or portions thereof, are invalid or inadequate or
not in compliance with law, or that this Agreement or any of the City's actions in
adopting it were invalid, inadequate, or not in compliance with law. Notwithstanding
the foregoing, neither party shall contend in any administrative or judicial proceeding
that the Agreement or any Development Approval is unenforceable based upon
federal, state or local statutes, ordinances or regulations in effect on the Effective
Date.
9.2 Hold Harmless Agreement. Owner hereby agrees to, and shall hold
City, its elective and appointive boards, commissions, officers, agents, and
employees harmless from any liability for damage or claims for damage for personal
injury, including death, as well as from claims for property damage which may arise
from Owner or Owner's contractors, subcontractors, agents, or employees operations
under this Agreement, whether such operations be by Owner, or by any of Owner's
contractors, subcontractors, agents, or employees operations under this Agreement,
whether such operations be by Owner, or by any of Owner's contractors,
subcontractors, or by any one or more persons directly or indirectly employed by, or
acting as agent for Owner or any of Owner's contractors or subcontractors. Owner
agrees to and shall defend City and its elective and appointive boards, commissions,
officers, agents and employees from any suits or actions at law or in equity for
damage caused, or alleged to have been caused, by reason of any of the aforesaid
operations.
9.3 Indemnification. Owner shall defend, indemnify and hold harmless City
and its agents, officers and employees against and from any and all liabilities,
demands, claims, actions or proceedings and costs and expenses incidental thereto
(including costs of defense, settlement and reasonable attorneys' fees), which any or
all of them may suffer, incur, be responsible for or pay out as a result of or in
connection with any challenge to the legality, validity or adequacy of any of the
following: (i) this Agreement and the concurrent and subsequent permits, licenses
and entitlements approved for the Project or Property; (ii) the environmental impact
report, mitigated negative declaration or negative declaration, as the case, may be,
prepared in connection with the development of the Property; and (iii) the
proceedings undertaken in connection with the adoption or approval of any of the
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above. In the event of any legal or equitable action or other proceeding instituted by
any third party (including a governmental entity or official) challenging the validity of
any provision of this Agreement or any portion thereof as set forth herein, the parties
shall mutually cooperate with each other in defense of said action or proceeding.
Notwithstanding the above, the City, at is sole option, may tender the complete
defense of any third party challenge as described herein. In the event the City elects
to contract with special counsel to provide for such a defense, the City shall meet and
confer with Owner regarding the selection of counsel, and Owner shall pay all costs
related to retention of such counsel.
9.4 Environmental Contamination. Owner shall indemnify and hold the City,
its officers, agents, and employees free and harmless from any liability, based or
asserted, upon any act or omission of the Owner, its officers, agents, employees,
subcontractors, predecessors in interest, successors, assigns and independent
contractors, excepting any acts or omissions of City as successor to any portions of
the Property dedicated or transferred to City by Owner, for any violation of any
federal, state or local law, ordinance or regulation relating to industrial hygiene or to
environmental conditions on, under or about the Property, including, but not limited
to, soil and groundwater conditions, and Owner shall defend, at its expense, including
attorneys' fees, the City, its officers, agents and employees in any action based or
asserted upon any such alleged act or omission. The City may in its discretion
participate in the defense of any such claim, action or proceeding. The provisions of
this Section 10.4 do not apply to environmental conditions that predate Owner's
ownership or control of the Property or applicable portion; provided, however, that the
foregoing limitation shall not operate to bar, limit or modify any of Owner's statutory or
equitable obligations as an owner or seller of the Property.
9.5 The City to Approve Counsel. With respect to Sections 9.1 through 9.4,
the City reserves the right to approve the attorney(s) which Owner selects, hires or
otherwise engages to defend the City hereunder, which approval shall not be
unreasonably withheld.
9.6 Accept Reasonable Good Faith Settlement. With respect to Article 9,
the City shall not reject any reasonable good faith settlement. Before accepting any
such settlement offer, City shall notify Owner of the offer and provide Owner with a
copy of the offer. If Owner disagrees with the City's intention to accept the offer, prior
to the City's response to any offer, the parties shall meet and confer in order to
attempt to resolve the parties' differences. If the City does reject a reasonable, good
faith settlement that is acceptable to Owner, Owner may enter into a settlement of the
action, as it relates to Owner, and the City shall thereafter defend such action
(including appeals) at its own cost and be solely responsible for any judgments
rendered in connection with such action. This Section 9.6 applies exclusively to
settlements pertaining to monetary damages or damages which are remedial by the
payment of monetary compensation. Owner and the City expressly agree that this
Section 9.6 does not apply to any settlement that requires an exercise of the City's
police powers, limits the City's exercise of its police powers, or affects the conduct of
the City's municipal operations.
M
9.7 Administrative Actions. The parties acknowledge that in the future there
could be claims, enforcement actions, requests for information, subpoenas, criminal
or civil actions initiated or served by either the Federal Government or the State
Government in connection with Owner's development, operation and use of the
Property (collectively, "Actions"). The City shall not disclose information and
documents to the Federal Government or State Government, its officers, or agents
regarding any party to this agreement absent a grand jury subpoena, civil or
administrative subpoena, warrant, discovery request, summons, court order or similar
process authorized under law hereinafter called "Governmental Notice". If any Action
is brought by either the Federal or State Government, City shall immediately notify
Owner of the nature of the Claim including all correspondence or documents
submitted to the City. Prior to responding to the Governmental Notice, City shall
provide Owner ten (10) days from the date of such notice subpoena or the like to
serve and obtain on the City a protective order, or the like, from a court of competent
jurisdiction.
9.8 Survival. The provisions of Sections 4.7 and Sections 9.1 through 9.7
inclusive, shall survive the termination or expiration of this Agreement, until such time
as the uses of the Property established in the Development Plan are permanently
terminated.
ARTICLE 10. THIRD PARTY LENDERS, ASSIGNMENT & SALE.
10.1 Encumbrances. The parties hereto agree that this Agreement shall not
prevent or limit Owner, in any manner, at Owner's sole discretion, from encumbering
the Property or any portion thereof or any improvement thereon by any mortgage,
deed of trust or other security device securing financing with respect to the Property.
10.2 Lender Requested Modification/Interpretation. The City acknowledges
that the lenders providing such financing may request certain interpretations and
modifications of this Agreement and agrees upon request, from time to time, to meet
with Owner and representatives of such lenders to negotiate in good faith any such
request for interpretation or modification. The City will not unreasonably withhold its
consent to any such requested interpretation or modification provided such
interpretation or modification is consistent with the intent and purposes of this
Agreement, provided, further, that any modifications of this Agreement are subject to
the provisions of Section 10.5.
10.3 Mortgagee Privileges/Rights. Any Mortgagee shall be entitled to the
following rights and privileges:
(i) Neither entering into this Agreement nor a breach of this
Agreement shall defeat, render invalid, diminish or impair the lien of any mortgage on
the Property made in good faith and for value; and
(ii) Any Mortgagee that has submitted a written request to the City in
the manner specified herein for giving notices shall be entitled to receive written
notification from the City of any default by Owner in the performance of Owner's
obligations under this Agreement.
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(iii) If the City timely receives a request from a Mortgagee requesting a
copy of any notice of default given to Owner under the terms of this Agreement, the City
shall provide a copy of that notice to the Mortgagee within ten (10) days of sending the
notice of default to Owner. The Mortgagee shall have the right, but not the obligation, to
cure the default during the remaining cure period allowed Owner under this Agreement.
ARTICLE 11. MISCELLANEOUS PROVISIONS.
11.1 Entire Agreement. This Agreement sets forth and contains the entire
understanding and agreement of the parties, and there are no oral or written
representations, understandings or ancillary covenants, undertakings or agreements
that are not contained or expressly referred to herein. No testimony or evidence of
any such representations, understandings or covenants shall be admissible in any
proceeding of any kind or nature to interpret or determine the terms or conditions of
this Agreement, provided, however, City at its option may rely on statements by
Owner's agents at the public hearings leading to the City's approval of the project or
on written documents by Owner's agents that are a part of the public record.
11.2 Severability. If any term, provision, covenant or condition of this
Agreement shall be determined invalid, void or unenforceable, by a court of
competent jurisdiction, the remainder of this Agreement shall not be affected thereby
to the extent such remaining provisions are not rendered impractical to perform taking
into consideration the purposes of this Agreement. The foregoing notwithstanding,
the provision of the public benefits set forth in Article 5, including the payment of the
fees set forth therein, are essential elements of this Agreement and the City would
not have entered into this Agreement but for such provisions, and therefore in the
event that any portion of such provisions are determined to be invalid, void or
unenforceable, at the City's option this entire Agreement shall terminate and from that
point on be null and void and of no force and effect whatsoever. The foregoing
notwithstanding, the development rights set forth in Article 4 of this Agreement are
essential elements of this Agreement and Owner would not have entered into this
Agreement but for such provisions, and therefore in the event that any portion of such
provisions are determined to be invalid, void or unenforceable, at Owner's option this
entire Agreement shall terminate and from that point on be null and void and of no
force and effect whatsoever.
11.3 Interpretation and Governing Law. This Agreement and any dispute
arising hereunder shall be governed and interpreted in accordance with the laws of
the State of California. This Agreement shall be construed as a whole according to
its fair language and common meaning to achieve the objectives and purposes of the
parties hereto, and the rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not be employed in interpreting this
Agreement, since all parties were represented by counsel in the negotiation and
preparation hereof.
11.4 Section Headings. All section headings and subheadings are inserted
for convenience only and shall not affect any construction or interpretation of this
Agreement.
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11.5 Singular and Plural; Gender, and Person. Except where the context
requires otherwise, the singular of any word shall include the plural and vice versa,
and pronouns inferring the masculine gender shall include the feminine gender and
neuter, and vice versa, and a reference to "person" shall include, in addition to a
natural person, any governmental entity and any partnership, corporation, joint
venture or any other form of business entity.
11.6 Time of Essence. Time is of the essence in the performance of the
provisions of this Agreement as to which time is an element.
11.7 Waiver. Failure by a party to insist upon the strict performance of any
of the provisions of this Agreement by the other party, or the failure by a party to
exercise its rights upon the default of the other party, shall not constitute a waiver of
such party's right to insist and demand strict compliance by the other party with the
terms of this Agreement thereafter.
11.8 No Third Party Beneficiaries. The only parties to this Agreement are
Owner and the City. This Agreement is made and entered into for the sole protection
and benefit of the parties and their successors and assigns. There are no third party
beneficiaries and this Agreement is not intended, and shall not be construed, to
benefit, or be enforceable by any other person whatsoever.
11.9 Force Majeure. If delays are caused by unforeseen events beyond the
control of Owner, such delays will entitle Owner to an extension of time as provided in
this Section and Article 7. Such unforeseen events ("Force Majeure") shall mean
war, insurrection, acts of God, local, state or national emergencies, third party
litigation, strikes and other labor difficulties beyond the party's control, any litigation
filed by a third party, any Action initiated by the Federal Government or State
Government, or any default by the City hereunder, which Force Majeure event
substantially interferes with the development or construction of the Project. ,
11.10 In the case of a Force Majeure event, any and all time periods referred
to in this Agreement shall be extended for a period equal to any delay to the Project
caused by any such Force Majeure event; provided, however, that no such time
period shall be extended beyond a cumulative total of five (5) years.
Extensions of time, when granted, will be based upon the effect of delays on the
Project. They will not be granted for: (1) delays of three days or less or (2) for delays
due to Owner's inability to obtain financing with respect to the Development of the
Project.
Owner shall in writing promptly notify Chief Executive Officer upon learning of any such
Force Majeure event. The Chief Executive Officer or his or her designee shall ascertain
the facts and the extent of the delay and his findings thereon shall be included in
Owner's annual monitoring report unless Owner disputes the findings and requests that
the period of delay be heard and determined as a part of the annual review process.
11.11 Mutual Covenants. The covenants contained herein are mutual
covenants and also constitute conditions to the concurrent or subsequent
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performance by the party benefited thereby of the covenants to be performed
hereunder by such benefited party.
11.12 Successors in Interest. The burdens of this Agreement shall be binding
upon, and the benefits of this Agreement shall inure to, all successors in interest to
the parties to this Agreement. All provisions of this Agreement shall be enforceable
as equitable servitudes and constitute covenants running with the land. Each
covenant to do or refrain from doing some act hereunder with regard to development
of the Property:
Property;
(i) is for the benefit of and is a burden upon every portion of the
(ii) runs with the Property and each portion thereof; and
(iii) is binding upon each party and each successor in interest during
ownership of the Property or any portion thereof from and after recordation of this
Agreement, it shall impute such notice to all persons as is afforded by the recording
laws of this State.
The burdens of the Agreement shall be binding upon, and the benefits of the Agreement
shall inure to all successors in interest to the parties to this Agreement.
11.13 Counterparts, This Agreement may be executed by the parties in
counterparts, which counterparts shall be construed together and have the same
effect as if all of the parties had executed the same instrument.
11.14 Jurisdiction and Venue. Any action at law or in equity arising under this
Agreement or brought by a party hereto for the purpose of enforcing, construing or
determining the validity of any provision of this Agreement shall be filed and
prosecuted in the Superior Court of the County of Los Angeles, State of California,
and the parties hereto waive all provisions of federal or state law or judicial decision
providing for the filing, removal or change of venue to any other state or federal court,
including, without limitation, Code of Civil Procedure Section 394.
11.15 Project as a Private Undertaking. It is specifically understood and
agreed by and between the parties hereto that the development of the Project is a
private development, that neither party is acting as the agent of the other in any
respect hereunder, and that each party is an independent contracting entity with
respect to the terms, covenants and conditions contained in this Agreement. No
partnership, joint venture or other association of any kind is formed by this
Agreement. The only relationship between the City and Owner is that of a
government entity regulating the development of private property and the owner of
such property.
11.16 Further Actions and Instruments. Each of the parties shall cooperate
with and provide reasonable assistance to the other to the extent contemplated
hereunder in the performance of all obligations under this Agreement and the
satisfaction of the conditions of this Agreement. Upon the request of either party at
any time, the other party shall promptly execute, with acknowledgment or affidavit if
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reasonably required, and file or record such required instruments and writings and
take any actions as may be reasonably necessary under the terms of this Agreement
to carry out the intent and to fulfill the provisions of this Agreement or to evidence or
consummate the transactions contemplated by this Agreement.
11.17 Eminent Domain. No provision of this Agreement shall be construed to
limit or restrict the exercise by the City of its power of eminent domain.
11.18 Agent for Service of Process. In the event Owner is not a resident of
the State of California or it is an association, partnership or joint venture without a
member, partner or joint venturer, resident of the State of California, or if it is a
foreign corporation, then Owner shall file, upon its execution of this Agreement, with
the Chief Executive Officer or his or her designee, upon its execution of this
Agreement, a designation of a natural person residing in the State of California,
giving his or her name, residence and business addresses, as its agent for the
purpose of service of process in any court action arising out of or based upon this
Agreement, and the delivery to such agent of a copy of any process in any such
action shall constitute valid service upon Owner. If for any reason service of such
process upon such agent is not feasible, then in such event Owner may be personally
served with such process out of the County of Los Angeles and such service shall
constitute valid service upon Owner. Owner is amenable to the process so
described, submits to the jurisdiction of the Court so obtained, and waives any and all
objections and protests thereto.
11.19 Authority to Execute. The person or persons executing this Agreement
on behalf of Owner warrants and represents that he/she/they have the authority to
execute this Agreement on behalf of his/her/their corporation, partnership or business
entity and warrants and represents that he/she/they has/have the authority to bind
Owner to the performance of its obligations hereunder. Owner shall each deliver to
City on execution of this Agreement a certified copy of a resolution and or minute
order of their respective board of directors or appropriate governing body authorizing
the execution of this Agreement and naming the officers that are authorized to
execute this Agreement on its behalf. Each individual executing this Agreement on
behalf of his or her respective company or entity shall represent and warrant that:
(i) The individual is authorized to execute and deliver this Agreement
on behalf of that company or entity in accordance with a duly adopted resolution of the
company's board of directors or appropriate governing body and in accordance with that
company's or entity's articles of incorporation or charter and bylaws or applicable
formation documents; and
(ii) This Agreement is binding on that company or entity in accordance
with its terms; and
(iii) The company or entity is a duly organized and legally existing
company or entity in good standing; and
(iv) The execution and delivery of this Agreement by that company or
entity shall not result in any breach of or constitute a default under any mortgage, deed
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of trust, loan agreement, credit agreement, partnership agreement, or other contract or
instrument to which that company or entity is party or by which that company or entity
may be bound.
11.20 Nexus/Reasonable Relationship Challenges. Owner consents to, and
waives any rights it may have now or in the future to challenge the legal validity of,
the conditions, requirements, policies or programs set forth in this Agreement
including, without limitation, any claim that they constitute an abuse of the police
power, violate substantive due process, deny equal protection of the laws, effect a
taking of property without payment of just compensation, or impose an unlawful tax.
11.21 [RESERVED]
11.22 No Damages Relief Against City. The parties acknowledge that the City
would not have entered into this Agreement had it been exposed to damage claims
from Owner, or Owners successors in interest, assigns, partners, or anyone acting on
behalf of Owner for any breach thereof. As such, the parties agree that in no event
shall Owner, or Owners successors in interest, assigns, partners, or anyone acting on
behalf of Owner be entitled to recover damages against City for breach of this
Agreement.
11.23 Laws. Owner agrees to comply with all applicable state, regional, and
local laws, regulations, polices and rules. In addition, Owner further agrees to comply
with all issued entitlements, permits, licenses, including any and all applicable
development standards. Specifically, Owner agrees to comply with all applicable
provisions of BPMC.
11.24 Compliance with Conditions of Approval. Owner agrees to comply with
and fulfill all conditions of approval for any and all entitlement, permits, and/or
licenses it receives from the City. All conditions of approval for all entitlements,
permits and/or licenses are attached hereto and incorporated herein by this
reference.
11.25 The City acknowledges that this Agreement shall be read consistent
with any statewide or national regulation of commercial cannabis that is promulgated
in the future, either by legislative action or voter approval. In the event national or
statewide regulations are promulgated which decriminalize or legalize the adult -use
of marijuana for recreational use, this Agreement shall govern the conduct of the
property under such future regulations.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the dates written above.
CITY OF BALDWIN PARK
By:
Manual Lozano, Mayor
ATTEST:
By:
City Clerk
APPROVED AS TO FORM:
By:
Robert N. Tafoya,
City Attorney
In
President
APPROVED AS TO FORM:
By:
mm
Legal Counsel for
EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
EXHIBIT A
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EXHIBIT B
MAP DEPICTING PROPERTY
[TO BE ATTACHED]
EXHIBIT B
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