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Arroyo Grande to let state regulate local cannabis deliveries 

Arroyo Grande is closer to, once again, allowing cannabis delivery services to operate within the city.

Members of the City Council voted 3-1 on July 24 to repeal local permitting requirements for commercial cannabis delivery businesses, deferring instead to the state's regulations. Mayor Jim Hill was the lone dissenting vote, and Councilmember Tim Brown was absent from the meeting.

click to enlarge READY TO ROLL Arroyo Grande is dropping its local permitting requirements for cannabis delivery services. Soon, any delivery business with a state license will be able to operate in the city. - FILE PHOTO
  • File Photo
  • READY TO ROLL Arroyo Grande is dropping its local permitting requirements for cannabis delivery services. Soon, any delivery business with a state license will be able to operate in the city.

Since June 2016, the city's municipal code required commercial medical cannabis delivery services to obtain a permit from the city to operate. Its repeal will allow any delivery service to do businesses in the city as long as they obtain a license from the state's Bureau of Cannabis Control.

"It continues the measured approach we've taken so far," said Arroyo Grande Community Development Director Teresa McClish.

The vote comes after a clash between the city and state regulations caused Arroyo Grande's first and only permitted delivery service, Elite Care Enterprises, to lose its state license. State regulations require delivery services to have non-storefront premises to get their license, but Arroyo Grande's local regulations prohibit any type of brick-and-mortar cannabis establishment within the city. Post-repeal, Arroyo Grande will now require that all deliveries originate from outside the city, McClish said.

While neighboring cities like Grover Beach and SLO allow medical and recreational delivery services as well as retail stores, Arroyo Grande's approach has been more cautious. The city banned commercial medical and recreational cultivation businesses as well as dispensaries.

Councilmember Barbara Harmon defended the conservative approach.

"We did what was right for the city at the time," she said.

The repeal will come back before the council for a second reading on Aug. 7. While deliveries in Arroyo Grande are set to resume, Hill noted that the city wouldn't be able to collect any taxes from those businesses. Arroyo Grande does not have a commercial cannabis tax measure, something the council would have to put before voters to pass and implement.

"I think we are giving up any possibility of getting tax revenue," Hill said at the meeting. Δ

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