City Council - Regular Meeting

Were you trying that was trying to get him?

No, it's not Friday. from that weekend holiday.

It is 5:00 p.m. and this meeting is in session. Council member Smith, can you confirm that you are traveling on a public agency business? [clears throat] Yes, I can confirm. Can you confirm that you can see and hear us? Yes. Can you confirm that no one over the age of 18 is in the room with you? Yes, I can confirm. There we go. It's break it's breaking in and out a little bit. I can confirm. Excellent. Please rise.

Dave, would you mind leading us in the pledge of allegiance tonight? To the flag of the United States of America and to the republic for which it stands. One nation under God, indivisible, with liberty and justice for all. Thank you. Madame clerk, can you conduct a roll call? Mayor Potim Castillo here. Council member Smith here. Council member Sieber here. Council member Wely here. Mayor Terry here. Mayor, you have a quorum.

Madame Clerk, do we have any public comments on non-aggenda items? Mayor, we do not. Moving on to item number one, authorization to negotiate and execute the purchase and sale agreement of approximately 34.99 acres of vacant land. our presentation by our city manager, Aaron Brown.

Thank you, mayor, uh, city council. I appreciate you here on this Monday for the special meeting so that we can address these two business items. The first item you have is the purchase and sale agreement for uh, what is called Goat Hill or Getats Hill. Uh this is uh made possible by the Martin family who is willing to make this sale to the city at what's called or defined as a bargain sale meaning they are selling it to the city at a lower value than what the or a lower amount than what the actual value of the land is. What the uh staff are asking for is permission to move forward with this offer uh from the uh uh Martin Family Trust to be able to buy this with $1.5 million in cash and the remaining approximately $1.4 million in value as part of that bargain sale. So, we would be uh taking on uh property that is worth approximately $3 million and it would cost the city $1.5 million if this were to move forward. I'd be happy to answer any questions you may have.

Anyone on council has a question for staff? I I have a question. Um, I I received a phone call this afternoon from a resident who lives in the area of the hill and the question from the resident was, "Does the city have any immediate plans to do anything with the um land and so I thought that that would be appropriate for staff to answer."

Absolutely. There not there are no immediate plans whatsoever. This is something that could be held in the uh city's portfolio. Uh typically an acquisition like this by a city is is for the future. Meaning it could be used for a myriad of things. It could be used for anything from uh whatever council decides. It could be used for open space. It could be uh sold to somebody or an entity like RCA. Uh it could be developed. whatever the uh city council would want to do, but there are absolutely no plans at this time outside of buying something that is this valuable for half of the cost that it would be. And because we're a city, there are tax advantages to this. So, that is the reason that we're able to do this. Tax advantages for the seller. Just to comment, RCA stands for uh Riverside Conservation Authority, and they basically uh purchase large pieces of land to set aside for habitat for um I wouldn't say endangered species, but endangered or endangered type species. And again, that's a possibility for us to do. Just I want to clarify because RCA is not common. Uh I do have one comment. Uh resident as well reached out and uh just kind of want to know some of the financial details. Understand uh it's uh being taken from our line of credit, but anything about um penalties of if we're paying this off or what's that interest look like over the term?

No. Uh we we wouldn't be going full term. Basically, what's what's going on right now is we've got the HSIP project that's going. the way that works, we've got to pay for everything and then the state reimbures us. It just wouldn't make sense to take that much cash out of our uh accounts at the same time. So, it's better to use that while we finish up this Hep project. HIPP project finishes up in uh February. Depending on what our rain delays could be, it could be early March. Once that's all done and we're completely reimbured from the state, we would pay off the uh line of credit. So it's very nominal on what we would pay for interest. There is no early payoff. It is a true line of credit. So um it just it makes more sense to borrow money for a short term than to to drain our cash reserves at that time.

Thank you. I had a question from a resident and their question was pretty simple. Does the purchase or the sale increase the taxes of our residents in any way?

Uh, it does not, mayor. It does not increase the taxes. Uh, there would be no uh change to our operating costs. Excellent. Any other comments? Uh, Madame Clerk, are there any public comment cards on this item? Mayor, we have one commenter, Darcy Burke. [clears throat] Thank you, Mayor Council. The dam property is so I want to thank you for having the courage to move forward with something like this. This is in the best interest of everyone. you have no immediate plans, which means there is purposeful thought in what you might do with this property moving forward versus someone that might decide to develop it for affordable housing or high density, whatever, which would be very concerning to the water district, at least to me personally. I would much rather see this property in the hands of the city in a transparent manner that there would be public input into whatever this might or might not be. Um, having been a neighbor of the Martins for a very long time, I think they would too. So, I'm very glad to see this moving forward and I just want to thank you for having the courage to do that. This has been a very contentious piece of property in the 26 years I've lived here. So it wasn't very um surprising that there was a lot of comments on social media and you know if you read on social media it's the truth. Um so I I just wanted to personally thank you. I think this is in the best interest of everybody from uh vulnerability standpoint. I'm glad to see that it'll be protected and safe until you decide what's the best and and greatest use for this piece of property. So thank you.

That's all I have. Madame clerk. Do we have any additional comments? We do. Joe, [clears throat]

Joe Kamation, good to see you. I love the place. It looks great. Um, [clears throat] I was around years ago when council battled with the the builders, developers, and uh they came up with a Ridgeline ordinance, a ridgeline ordinance that is in place today. And as far as [clears throat] excuse me, as far as I know, it's uh in permanently. Um is there any plans for this council or in the future for modifying or removing that RGEL line ordinance? That's just one of my questions. If you want to address that or if you can, can I defer that to our city manager?

I will send it to the city attorney as this is public comment. Uh [clears throat] I I think that would make it an interactive portion. So I'll let the city attorney speak on that. Yeah. Uh mayor, generally uh members of the public are allowed to ask questions, but it's not a back and forth. So uh okay, ask all the questions you want and then the mayor and the council can ask for answers from staff.

Um and I understand if it is a $3 million mountain, uh clearly it's not of much value, uh at this point. Um, and I'm wondering, the Ridgeline ordinance seems to protect the community from any major development that's going to could go on. Um, what is the point of actually purchasing it, spending a million half dollars, even though it's a good price, and there's no question, I assume it's been appraised. I I I assume the value was uh not just pulled out of the sky. it was a legitimate value, but um I just curious as to what uh you know the value is worth and why why we're doing that. So that's my question. Thank you,

Madam Clerk. Do we have any additional comments? Mayor, we do not. Any further question? I need a motion. Mr. Mr. Mayor, Mr. Mayor, before we take a motion, may I make a comment? Absolutely. Uh, Mr. City Attorney, would you mind repeating what Mr. Kamishian said, not quite getting the public comment that was that was discussed?

Uh, sure. the the essential crux of the question was is there any present intent to rescend the existing uh RGLE ordinance that the city has on the books? Um understood.

Um my only comment on this is, you know, I'm very excited about the direction that we're headed, not just as a council, but as a city. Um kudos to you, Mr. City Manager, for bringing this deal forward. We've been working on this for quite a few years now and the fact that the Martin family came too I think because of your leadership. Um this this helps out so much from a financial standpoint. I mean most of the people will know that especially cuz this council as of right now have no plans other than just a financial benefit of that. Any chance we get to grab a hold of an extra million and a half is huge for our community. Huge opportunity. So I want to give kudos to uh to our city manager on this. I want to give kudos to Council Member Welty. Um, thank you for all the knowledge and the background information on this piece of property. I know it's a very controversial one. Um, you lived it. Uh, as you heard from our director, Burke, she lived it. Kamisha knows it well. So, we we know the history of this piece of property and what it does for our community. But, I do believe that um this is a win-win um for our city. Again, it's and it's local. Um, so I'm all in. I'll be happy to make the motion on this if there's no more comments. Mr. There.

We need a second. Second. Madam clerk, can we get a roll call vote? Mayor Prom Castillo. I. Council member Smith. He froze. He's not He's not frozen. There we go. I Council me Council Member Ste I. Council member Welty. Hi. Mayor Terry I. Motion passes.

Item number two is the introduction and first reading of ordinance number 269 and ordinance of the city of Canyon Lake, California amending chapter 4.20 commercial cannabis businesses. And we have another presentation by our city manager, Aaron Brown.

Thank you very much, Mayor Mayor Prom and Council. Uh with this item, uh staff is looking for a a combination of items here. One is to essentially affirm the process that the city went through with the prior bids and uh uh that process that has now um for lack of better words and maybe the city attorney can give better words run its course. It's gone through everything. We uh have no uh remaining process intact. Uh, and the other thing is we're asking that we go from we have the ter the current two permits. We're asking that we go back to one permit. And that's for many reasons. One, I I believe that was city council's original intent was to have one. It gets us back there. Two, it really gives me a lot more to work with to try to attract a good cannabis partner. uh because there's going to always be that kind of threat of if you bring one in, a second one could come in and undercut them at at at any time. So, uh that is what we're looking for, the ability to go down to that one to uh affirm the end of that process and then u make the modifications to the the listed modifications to the uh uh ordinance. Thank you. And I I'm available for any questions. Any comments for staff questions?

Uh, Mr. Mayor, I do have a a comment. Uh, thank you, city manager, for going over that. And, uh, as you said, this is two-parter and definitely all for uh, removing city council as the appelllet body uh, moving forward in any of the cannabis permitting decisions. Um, I I I do have a comment. Um, and really I think this is more aligns with council and kind of what their goals have been for cannabis. Uh, I know when you had the April resolution, the main goal out of that was to look at increasing revenues. Um, there's been some challenges along the way both as the cannabis business staying in and kind of the numbers that we had out there that they would have to to achieve. um it didn't pass through the an election, but council did come back and reconsider back in January of this year to reduce that contribution rate to make it more attractive to both of those cannabis companies. Neither of them went anywhere. Um, but today's uh uh resolution um and thank you again, city manager, you brought up a couple points, but I know we were focusing on public safety and when I we talked about this last and close session, kind of talked openly, but when I really got to see this agenda and you know what the resolution is about, it kind of maybe almost gave me a second thought of are we making a right decision? I'm not thinking of making the right decision of reducing because I still want those revenues and I think any additional chance we get we should have maybe multiple but if cannabis retail could be a sense of uh a problem when it comes to public safety uh the wellness and the welfare of the community uh I don't think we should take any chances with that and my recommendation would then go to zero the goal still is drive revenues is um we have multiple liquor stores, we

have multiple of a lot of businesses in our community. Um and I still think that gives the flexibility of keep driving revenue. So again, kind of had a different change of heart at this wanted to bring it to the attention. Um and that was strictly based off the agenda item and and and the the language in there and really keep the focus on if public safety is is is the key issue from the past cannabis. Let's [clears throat] let's keep it out of here fully. So, any other comments? I I want some clarification on that,

M. Mr. Mayor, just because I want to hear it clearly. Is is Council Member Steers um is his idea to keep both permits? Is did I hear that correctly?

In and if we're looking at the goal being revenue generation, Absolutely. based off the current agenda and the focus of it is public safety. Um, you know, we we state in here that this resolution finds the limiting the number of commercial cannabis retailers to one will better protect the public health, safety, and welfare. And it's consistent with the city's policy object objectives and police power authority. And if that's true, and that's where my change of heart is, let's not take the risk with one. Let's not have any. And that's kind of where I was just bring it more as a talking point and cons a reconsideration on the item. for Tim.

Yeah, I'm I'm kind of confused simply because my understanding when we drafted the ordinance was that we were very specific in where the cannabis stores could go based on, you know, proximity to the library and churches, etc., schools. Um, and I think that was what the council was focused on in terms of public safety. I do know that we have a um, captain now, chief of police, who's been very familiar with working with cannabis companies and making sure that things go smoothly in in the community. Um, so I I mean I'm not really certain and I guess I'm asking for clarification on what you mean that it's potentially an unsafe retail.

I personally don't believe it's unsafe, nor has been. And I think our chief could correct me if I'm wrong. Let us me know if there was any issues with her regarding retail based off our agenda tonight as we're stating that switching from 2 to one is based on public safety. That's that's what it states. And so my thoughts are if public safety is that [clears throat] key, why not go to zero? as as the person who drafted the resolution, maybe I can address the the council member's concern. Uh so the language that is used in the warehouse clause is to protect the public health, safety, and welfare. So that is essentially a recitation of the city's police power under the California constitution. Uh what was in my mind when I was drafting that was that the uh revenues that are derived from the operation of cannabis dispensaries uh goes directly to public safety. uh programs within the city. Um and by having a more sustainable business model, uh we've obviously had some fits and starts with with the program. By having a sustainable model that will result in uh consistent and uh revenues that we can count on. I I know that, you know, in the past, you've had the city manager talk about the revenue that have come in from the city's previous cannabis operators, and he budgeted them as one-time funds because he wasn't certain that they would be there, and it turned out to be correct. Uh the goal is to have a sustainable business model that can continue to support city operations otherwise. So, that's what I had in mind. Uh as far as I know, there were [clears throat] no public safety incidents of any kind. at at our at our previous operation.

I can confirm there were zero. Uh so that that wasn't what was in in my mind when I was drafting that language. So I just wanted you to know what I was thinking of. And thank you for clarifying that. Um cuz again, I didn't think so either. Um but didn't know if there was a change of that. Um the mayor, if I could piggy back off of what the city attorney said as well, please.

Uh part of what he's saying is sustainability. That is my reason for asking council to go down to one. I do not feel that a city of our size it is sustainable to have two permits to create a level of competition among such a small sliver. I I've given my uh input in the past on uh cannabis consumption and how that it works that whether a a city has a cannabis dispensary or retailer has no bearing on whether or not the cannabis consumption uh will will be in place. So, you're going to have a a number of uh percentage of the city that are going to purchase legal cannabis from dispensaries. My point is it makes no sense to not have that in the city where it's in a controlled and safe environment that meets all of our our ordinance requirements that would not lead to the tax revenue going to the city. So, you're going to have the same amount of cannabis purchases, if you will. It's just now it's going to be purchased from within the city and then we'll provide a revenue to the city.

Any other questions? Uh, city attorney already kind of summed it up based off the language and we'll we'll talk after. I'll show you and give me my reassurance one more time. Mr. Mr. Mayor, if if I may, Council Member Stever, is now that the city attorney has kind of cleared up the language a little bit from the public safety component that you were concerned about, does that change your mind on going from 2 to one? Um, yes, it still changed my mind. Sorry,

I don't know if you can hear me. Um, yeah, I was just trying to see where council's goals was. Again, back in April 24, goal was increase revenues. Now, the goal um you know, it's kind of more a stance on if we reduce the one um we'll one be able to attract uh better, I guess, business. Um, but then I also thought about, well, we're already reducing the rate that we kind of thought of the first time around when this was put into place at having two, you know, where we're able to get a little more. Uh, I know within our entire boundaries, the two shopping centers, uh, it was cleared for any location. And not saying a second one's knocking on the door today. Um, and it still gives city manager authorization to throw in one out if possible, but still keeps people competing in the market uh for the for those business opportunities within our city.

And and I think that that's a good point, council member. I can tell you that um you know, one of the things that we analyzed when we were putting this staff report item together was, you know, is this creating some sort of impermissible zoning monopoly uh for for the operator? And and the fact is that a great several jurisdictions that surround us already have cannabis retailers operating. So there there already will be competition uh that that exists. I think the when you know you were talking about the the goal of you know revenue generation. I think we have this it's still the same goal right but I think it's it's a realization that the city of Canyon Lake is only so big. We only have a shopping center with a certain number of available units. Uh that is further reduced by the sensitive use buffers that the mayor prom referenced. Uh and you know we only have uh so many consumers available that that'll be going to it. And so if we if we want to achieve that goal uh then you you probably want to start with that sustainable model. Now the city council has already demonstrated that it is capable of raising the number in the future if circumstances change. Um but but I think you know what the you know sort of city manager was alluding to was that his goal uh would be to uh entertain a proposal from a highly qualified sustainable business. Um and the likelihood uh is higher if we have a a single uh permit available. Thank you.

Thank you. I would agree, Mr. Mayor, if I may. Yes. I just want to say thank you once again to our city attorney and city manager on this. Um Aaron, you know your council as one of the only two that voted no on the original ordinance on this. I think you found some common ground here. um working with the entire council and more importantly I think it's wise of you um to be the one who is looking at who that applicant's going to be and takes this off takes the pressure off. I think this is a win-win for the entire council. Um if there's no public comments I would be more than happy to make the motion move the item on this one. Thank you Mr. Mayor. Madam Clerk, do we have any public comments?

Mayor, we do not. I need a motion and a second to take item number two to take the staff's recommendation. Chair may make a motion. We do. We have a motion on the floor. We just need a second. Second. City clerk, will you conduct a roll call vote? Mayor Proim Castillo, I. Council member Smith, I. Council member Steber, I. Council member Welty, I. Mayor Terry, I. Motion passes. And with that, this meeting is adjourned unless there's any further comments. Thank you.