Finance Committee - Regular Meeting

to introduce themselves, please.

Susan Wilson, Assistant City Attorney.

Peter Cacos, Budget Manager.

Elizabeth Martinez, Finance Department.

Thank you very much.

Let's stand for the Pledge of Allegiance.

Good afternoon. Miranda Evans, Community and Economic Development Director.

Thank you. All right, ready, begin.

I pledge allegiance 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.

Can we have the inclusion statement read, please?

Pursuant to the City Council rules of procedure and order of business resolution, the members of all Boards and Commissions and the public are reminded that they must preserve order and decorum throughout the meeting. In that regard, members of the Boards and Commissions and the public are advised that any delay or disruption in the proceedings or a refusal to obey the orders of the Board or Commission or the Presiding Officer constitutes a violation of these rules. The city of Riverside is committed to fostering a workplace that provides dignity, respect, and civility to our employees, customers, and the public they serve.

Can we get a roll call, please?

Commissioner Ira. Commissioner Bello. Commissioner Broughton.

Present.

Commissioner Hutchins.

Present.

Commissioner Ward.

Present.

Commissioner Benavides.

Present.

Commissioner Chernyakoff? Commissioner Lagner?

Present.

Vice Chair Vandenberg?

Present.

Chair Williams? We have quorum.

Thank you. Can I get a motion to approve the consent calendar? So moved. Second.

You may now begin voting. Motion passes unanimously.

Thank you. Okay. We're looking for a cannabis retail program update by Miranda Evans, please. Welcome.

Thank you so much. Good evening, Honorable Commissioners. It's a pleasure to be here. Miranda Evans, Community and Economic Development Director. And we will cue up a presentation.

Trust me, one of the... Oh, was your laptop on?

Ah, okay.

That would do it? It's off.

And

Thank you so much. Well, I appreciate the patience. Apologies for technical difficulties. It's my pleasure to be here in response to a referral from the commission to provide you a program status update about our storefront retail commercial cannabis program. The volume is getting louder and louder. Okay, a little bit of program history just to level set you. We have a merit-based application process for storefront retail commercial cannabis permittees. This involves a limited storefront retail rollout, and we have a ward-based geographic distribution. Last summer, pursuant to City Council direction, We have amended the municipal code and also the guidelines for the program implementation where we are now pursuing a one retailer per ward program. And so this means we will have up to seven storefront retail commercial cannabis locations in city limits. This provides you really the heart of what we're hoping to update you on today, which is the readiness and retail status by different sites in every ward throughout the city. So with those seven locations that I had mentioned, we currently now, we have the first one that was ready to open and they opened in March, 2026. This is Embark and they're operating in Ward 6, open and operational, adding 14 jobs to the city of Riverside. We have not had any security concerns with them and are in close coordination as well. After the publication of this agenda, I'm now before you this evening with some good news. We also have number two open and operational. So you'll see next on the line, and these are ranked and ordered by their readiness to open, by the way, is Embark, and that's Ward 2 at 1601 University Avenue. So, their target open date, and we're working with them daily and in weekly meetings, their target open date was July 6th. Great news, they were issued their permit to operate on July 7th, the very next day. So, they have satisfied all of the requirements and conditions to operate, including a rigorous inspection process of state and local requirements. Up next, we are currently in the inspection process in Ward 5 for STIZI at 3636 Van Buren Boulevard. They have a target open date coming up of July 11th. They have a deadline to get open and operational by August 8th. That is the date by which they need to obtain their certificate of occupancy. So our team is working in close coordination with them as well as our cannabis facilitator. Following Ward 5, up next, we have Ward 1 at 2870 University Avenue. This is another location for SCSI. Ward 7, following that, a location for Embark at 10438 Arlington Avenue. And then we have Ward 3, following that, at the 6th to open at C4TP Retail at 4920 Jackson Street in Ward 3. And for Ward 4, they are still in the early phase of their site selection. So this is what we call step 2.1 within the process that they all must follow. And we're coming up on their deadline to submit their preferred location by July 14th. And so we're working with them actively through that process as well. But really what the commission should know and be aware of is that at this time now, we have two permits that have been issued of the seven and with the goal of getting the first six of those seven open and operational by the end of this summer. So coming soon. Also under this commission's purview, revenue, which staff would surmise is the reason for this referral. So in consultation with the city attorney's office, we are not able to share with you revenue or revenue projections until we have at least two of the locations open and operational. It's only been a couple days for Embark, our second applicant, to now have their permit. And so we will come back to you, but we do not have any numbers available at this time in the interest of security and privacy. So that gives you an at-a-glance of progress moving forward in all seven of the wards. This is also a storefront retail location map for your reference. Of course, you're familiar with the addresses, but this just provides another view. Ward 1, Ward 2, Ward 3, Ward 5, Ward 6, and Ward 7. Not pictured here, you'll notice I skipped Ward 4 as they are still pending their preferred site location submittal. And so as an implementation update, as part of getting open and operational, I mentioned all of those state and local requirements that operators are required to comply with. That includes operating agreements, necessary insurance, all of their permits with the city, inspections, obtaining their certificates of occupancy, and their state license as well. And so with that, staff recommends the Budget Engagement Commission receive and file the update, and I'm happy to answer any questions you may have.

We will now open the phone lines for public comment.

Public comment is now open for this item. Call 951-826-8688 and follow the prompts to access the meeting. To request to speak, press star 9. When called to speak, press star 6 to unmute. You can also join via Zoom. The meeting ID can be found on the agenda.

Do we have any callers?

No callers.

OK. Commissioner Hutchins.

Hi, thank you. Thanks for the report. Just a couple of technical logistical questions I was wondering. Because I see we have target dates of openings and things like that. Roughly speaking, how long does it go from, let's say, how long is the target? So obviously the timelines can shift, but target from they've been selected and now they're working to select a location to opening. What's our target timeline. Obviously timelines can shift based on actualities. I'm just kind of curious what the target timeline is from start to finish.

Absolutely. Thank you for the question, Commissioner Hutchins. It's really dependent on the applicant, and we do our very best to move them through the process as quickly as possible. But they're going through a phased approach of getting from step 2.1 all the way through step 2.4. And so we're working with them, and we have a cannabis facilitator who's independent as well to ensure that they're getting all of the support they need to move through the process. So some have been very quick, and as you can see, some are still working on step 2.1 and selecting their location they wish to move through the process on. So it can vary. Okay.

And then the second is, and this is my own lack of familiarity with now the current sort of ordinance around this. I know we're moving forward with one location per ward, and I'm... I'm not sure if you can answer this, but I'll give it a shot. Is that, do we promise any version of exclusivity? Like, if Council wanted to go back and change and then allow for an expansion, is that something that Council is allowed to do? Or did, like, when they created the ordinance, did they make sort of an agreement that we'll stick with one per? Meaning like if they decide later, like let's say five, six years down the line from now, they're like, okay, cool, maybe we can offer a second. Was there some level of exclusivity that was made with these sort of business partners as they came online that we would not allow additional in their awards?

Go ahead. Understood. Yes, thank you. I understand where you're going, Commissioner. We do not have any guaranteed exclusivity, and I should also clarify for the Commission's knowledge, the permit is valid for one year of the date of issuance. So at any time, as with all ordinances, the City Council has the purview to amend and direct staff at their discretion. Correct. We've not received direction to bring the policy and ordinance. We have policies and an ordinance back to council for reconsideration. And so that was recent direction from last summer, I believe about a year, last August already, to make that change. But to answer your question, there is no exclusivity provision, and they do need to remain in good standing, and their permit is good for one year from the date of issuance.

And then I guess the last question I have, which would respond by that one, is there kind of like an automatic process of which they go in for a review of renewal, or is it like they have to initiate a renew before such and such date? Like, let's say, I know you just issued one. Is there, like, okay, in the calendar, we're going to start reviewing for their renewal in X amount of time? I know they have to pay for the renewal and all of that, but is there, like, a fixed timeline for them to, like, submit a renewal process, or is it on the business?

That I will need to check what the guidelines indicate. We have just issued, so we're not to that process yet.

I was just curious. Okay, thank you. That concludes my questions. Thank you, Mr. Chair.

Commissioner Ward. Thank you, Ms. Evans, for that good presentation there and this update. I know we've been waiting for this for a long time. Just some top-of-line questions I have, and I want to just preface. This is just based off of just some concerns that I have based on cannabis, but The data does show, just based off of some research that I have done, that shows that just cannabis implementation in general is not as drastic of a negative impact as some might have assumed. So I just want to preface there. So first top of mind question is, are there any research being done and analysis done being completed by the police department or by economic development that would highlight any concerns about increase of crime or any negative impacts on sales and other retail businesses with the implementation of cannabis stores in adjacent neighborhoods.

Not that I'm aware of, but we'd need to check with the police department. They do have a very strict operational plan. They have an operating agreement that is very detailed, very in-depth, and also includes security measures. So they work extremely closely with the police department on implementing those security measures, and one of those includes live feed to their security cameras on site. So in regards to calls for service, that could be something that we could work with the police department to map out. But with only one operating so far, I do not have data readily available. I'd need to work with the police department. And I've not received any main concerns from the police department to date.

Yeah, and it would be nice to know for, I guess, the one that is currently operating, but I guess my broader question is more about cannabis stores in general and other municipalities, whether it has been linked to an increase of crime, whether or not sales in other retail businesses like third space retail businesses have been impacted as well. So that would include restaurants, bars, coffee shops, places like that. So I'd be curious to see just how thorough we can get into that level of detail because I think those kinds of retail spots should be more prioritized over these, and I want to make sure that they're not being squeezed out in major corridors and economic zones within Riverside. And lastly, within that question, the residential engagement, what has residential engagement look like as you're trying to implement this program? Have residents supported it by and large, or have they been noting any kind of concerns themselves?

The engagement is really incumbent upon the applicant to engage with. Staff hasn't done public outreach regarding that. It's really incumbent upon the applicant of the location themselves.

Is that standard for businesses coming in? Is it always incumbent upon any retail business or do they ever lean on staff to do that outreach as well?

Retail, correct, yes. Businesses and also development projects, it's incumbent on the applicant.

Right, okay. Yeah, thank you for that. And the second question I have is within the seven locations, I don't know if you would have this readily available, but do you have any idea as to what the median income level of the neighborhoods are where these cannabis stores are being?

No, staff does not have that data.

Okay, and would that be something that staff could get by any chance?

Median, so you're asking median income per ward adjacent to the location of each storefront retail dispensary?

Yeah, I guess within the neighborhood that it's being implemented in.

We could certainly look.

Okay.

Okay. Yeah, I think that concludes my questioning then. Yeah, I just like those as a follow-up. Again, just want to reiterate, would like to see if there's any impact on crime and sales for those areas and for other adjacent retail businesses that would sit next to those. and would like to maybe see if we can get some some input from from staff if staff could reach out to those businesses about Residential engagement so that we can have a better understanding of that as well. So and and also the median income level piece. So Thank you. I think that concludes my questioning Commissioner lagner

Thank you for the report, Simone. Will you remind me what the age limit is for the clients of these stores?

Is it 21?

Yes, that's correct.

OK. So based on the number of employees at the store that opened in March, you said 14. Is that the anticipated ceiling for these other six locations approximately, or is there any room for growth as far as the employees go?

Thank you for the question, Commissioner Langer. I would say there's no ceiling. It's really incumbent upon the operational needs of the business, including the size of the facility. And so that is something that they identify in their operations plan and is a private business need and not something that the city has a role in. And it varies on each site as well.

So if you take maybe a municipality that was ahead of us on this. I mean, is there any data on, I'm just curious, I mean, anybody that's reached 20, 30, 40 type of employees? Um, because this, what, I mean, just using the numbers you gave it, it looks like there's going to be less than a hundred employees between seven different locations.

Could be. Depends on the size. Depends on their operational needs and their business needs. I don't have data on number of FTEs that they would employ at other cities and wouldn't want to give misinformation to you.

Okay, if that's something that we could get, I'm very curious as to what this is going to contribute to the employment for the city. Another question that I have, are all the owners of these retail establishments local and living in Riverside, or are they outside Riverside city limits?

I am not sure. I would need to check.

I'd really like to know that, please. And if they are outside River City limits, I'd like to know if they are part of a broader network. And can you address, in the application process, was there an emphasis put on trying to get local ownership of these?

I would need to refer back to the application. I'm not sure. OK. It was a merit-based application process.

I understand that part of it. It would be nice to know if that's merit-based. If you see where my questions are going and it's all aligned, I'd really like to see that this truly is going to be a benefit to the city. And if we have outside owners versus other owners that might be interested in this that live in the city of Riverside I'd just like to know that to go back to a question that was asked on the annual application do incumbent applicants get preferential treatment in the renewal or is it a as you're saying merit-based and so if another applicant comes along that is with whatever the criteria are would look um better are they going to be given equal um equal preference uh we have we've not yes thank you commissioner we've not gotten to the renewal process yet i need to consult the guidelines and see if that was established in there OK. And then to piggyback off of my fellow commissioner that asked about the crime aspects of this, I'm also interested at what might be regarded as a lower level, but I think it's equally concerning. Is there any plan to track with RPD things like increases in DUIs in the city limits, or under the influence if those are different, if they're the same. Domestic violence calls or domestic calls in general. And then, yeah, I guess those would be two other factors that I don't think are necessarily considered to be criminal, but I would like to know information on that because there is, similar to alcohol, a connection. So I think that's equally important.

Understood. We can work with the police department on tracking that, and they have a log of calls for service by location, and so we could review that data.

Sure. All right. Thank you, Simone.

Commissioner Benavides.

Thank you, Mr. Chair. Actually, my question was going to focus on job creation, and that's been asked by Mr. Langler. Miles Ward, Commissioner Ward, spoke about crime, and so did Mr. Langler. I was thinking about alcohol versus the use of the plant. And it would be interesting to see in our city in a few years maybe a side-by-side study between bars and dispensaries. But my thought is there's far more bars in our city than there are dispensaries. even after the seven are established. But yeah, I think to make it a reasonable study is to compare those entities that are nearby each other. I know the Embark on Ward 6 because I live in walking distance from that facility. I grew up in Los Angeles, East Los Angeles, and there was always communities talking about the comparison between alcohol use and marijuana use. And back in the day, those that partaked in drinking tended to be more violent at bars than people who smoked. They tended to be more mellow, et cetera. And the use would be sometimes for medical reasons. But it'll be interesting to see in our city, because I think Riverside's unique. And we're ever-changing. But anyway, thank you for the report. And I appreciate my colleagues asking the questions that they did. So thank you.

Commissioner Lagner. Thanks. I just want to piggyback on two of the latter comments that I made, and I'll give context for these questions. In addition to the DUIs and domestic violence calls or domestic calls of any kind, I'd also be interested to see if there is any increase in just overall traffic stops. And then this is going to be much harder, but you Being in the development side of this, I have a connection, I'm assuming, to the business community. And I'd maybe through the Chamber of Commerce be interested if there's a way to track this. I'm going to call it professional business truancy. And a lot of my concerns for this overall are Colorado has been way ahead of us. on this subject and business. And my professional counterparts that I know in Colorado and pretty broadly based in Colorado, it's significantly impacted that state. I just want to make sure that we're being as responsible about this as possible. Because if we put crime aside for a minute and some of these other things I mentioned, on the professional business side, it has dramatically impacted the state of businesses in Colorado and their effectiveness and their efficiency.

So thank you. No motion needed. That was received and filed. So thank you very much for your presentation.

Thank you, Commission.

Next up, I'd like to welcome Deputy Finance Director Peter Kakos.

Good afternoon. Peter Kakos, budget manager. I don't want to take Sergio's title from him. So just to give you guys a quick update, we have a couple things. On June 23rd, 2026, the city council adopted the 26-28 biennial budget as proposed with no changes. And during the last BEC meeting, there was a lot of discussion regarding the scope of the BEC. The plan right now is to bring an item forward to BEC in August to discuss the scope, including a path for BEC to recommend the changes to the scope. And that's all I have.

We have a question for you, Commissioner Lagner.

No, that was from before. I didn't clear it. Okay.

Well, if there's no questions, you do have one.

And this could fit under this one, but also, actually, you know what? I'll hold it for the next item. This goes under that. Okay.

Thank you very much. FEATURE ITEMS LISTED ON THE MASTER CALENDAR. WE'VE GOT QUITE A FEW FOR AUGUST HERE. WE'VE GOT A CODE OF ETHICS, SOCIAL MEDIA REPORT. WE'VE GOT A Q3 FINANCIAL UPDATE, FIRE DEPARTMENT TURF REPLACEMENT SUPPLEMENTAL, BEC SCOPE AND POWER TO AGENDIZE, AND THEN TBD, WE'VE GOT HISTORICAL AUDITS, MEASURE Z REVENUE BALLOT, MEASURE ITEMS FORMAL POLICY, AND THEN CHILD CARE.

if there's something we'd like to add to that discussion calendar yeah so um a couple of i guess requests tied to it um if the vice chair and then eventually the chair as well as staff are amenable that agenda looks rather long for august and so it might be useful for folks to get together and figure out what should be pushed to september what can be i'd recommend not doing the q3 update I would probably put in a request to move the scope. And that's, again, as a reminder to this board, I will be absent from the August meeting, as I initially notified last year and reminded the folks last month. If it's possible, I'd like to be part of that conversation. I totally understand if that's not possible. But if it's possible, move that item, as well as any others you may want my input on. Thank you.

I'd say before we move on, Miles, is that something we can discuss now? Do we have to make a motion for that? Can we move those two items to a future meeting?

We can move them based off of whatever you guys want. If you prefer to have everybody here for the discussion on the social media and

But I think it's more the scope.

We can make sure to do it on a date where we know everybody will be here.

All right. Any discussion on that? Is everybody OK with that?

I am. Although it's hard to predict the future that specific, but I would recommend the scope be agenda size in September would be my motion.

Do you want a motion for that?

I don't think we need a motion.

I think it's just a request.

We just do it?

OK. Yeah. Can we, if we could, if everybody's OK, we'll move the scope conversation and the Q3 financial update to a future meeting. OK? OK. Commissioner Ward.

Thank you, Vice Chair Vandenberg. I'd like to agendize just an economic development update. We received one for cannabis tonight. I'd like one just on our general economic development activities for other retailers. This could end up being long, and I apologize for that. And yes, I'm agendizing this as it relates to Measure Z funding so that we can include additional revenue avenues to analyze and to discuss as a commission. So I want to agendize that. Also for... the business investments into Riverside. We were told by the last city manager that there have been $5 billion in business investment into Riverside. I would like to see more of a breakdown of that, the job impacts. of what that looks like. And again, all this is towards revenue generation. So I believe that it's within our scope. And also how we compare to other peer cities as well. So just a broader discussion on that. I can probably email and be more specific on some of the asks that I'm requesting. So I would just like to get that on the agenda in the future.

Not for August but for maybe September October And if I might can make a comment and assistant city attorney Susan Wilson, I don't usually staff your commission meetings, but The one thing that I would caution you on is that under our city charter all powers and duties reside with the City Council unless it's delegated either through the Municipal Code or by our voters and And the purpose and function of the Budget Engagement Commission is to advise the City Council on spending and policy priorities. And that's under RMC Section 2.90.020. So if you want to start discussing revenue generation, we will have to bring this forward to the City Council to expand your scope and revise the RMC.

If I may, sorry, I'm going to correct me if my edit is not within line. I'm going to change his reasoning for that to bringing that forward to seeing what the projected revenues will be already based on the Measure Z and the economic development tied to it, which will inform our ability to make decisions upon their expenditure.

So you can advise the city council related to revenues from transaction and use tax? Correct. And how to spend, but not how to generate revenue.

Correct. So my edification of... It doesn't change as item, it just changes the reasoning, which is having an economic development update on that specifically kind of showcases what revenue is already set to be generated, which then we can then use to inform our decisions upon recommendations of spending. So I just changed the explanation to fit within what I believe is our scope on the expenditures. We will have another conversation on benefits of expanding, but I was trying to, a path of least resistance, I'm trying to get you your object without changing the reasoning for it, if that seems suitable.

I think so. I mean, I'm only the attorney. I read from the municipal code to you. I think we can make something work with that.

Okay. Thank you, Greg. Before we wrap this up, I'd like to ask for some clarification based on the conversation we're having now. Some of the requests made tonight regarding crime stats and things of that nature, does that fall under our purview? Is that something for future meetings going forward? We're asking questions that I'm not sure do fall under our purview, and I'm curious to know your opinion on that.

Correct. And thank you for the question. As I was listening to the questions, I realized that really is outside of the scope of the BEC because the city council has taken the lead on reviewing the cannabis program and setting regulations. So, again, if you wanted to get involved in how applications are granted, tracking crime statistics, asking staff to gather all of this information, that really doesn't fall within your purpose and function under RMC 2.90-020. So I would suggest that all of these things be sent as comments to the City Council for them to review, but really agendizing this, again, to discuss RMC. the impacts of having cannabis in terms of crime really doesn't fall within this, under the RMC, within this commission, although you certainly could go to the city council and ask for an expansion of your authority.

I do recall, Susan, Last year, the chief spoke about the drones that were purchased with Z money to take a look at fireworks. And I remember the report indicated that there was $98,000 generated from fines to those folks that were illegally using fireworks. That was crime related, but I think, correct me if I'm wrong, the difference was the drones were purchased by Measure Z funds. Are there any funds that are used from Measure Z that the city used in regards to the dispensaries?

I would have to refer to the staff that handled this, but generally when an application was filed, there's a fee assessed for the license, which is meant to recover all of the city's costs.

So no Z money was used for any of that?

I'm not 100% sure on that. That would be good to know.

Based on the information that I know, all the money that was collected regarding the application fees and everything like that, that was in the general fund. So that really isn't commingled with the Measure Z funding. So it would be strictly on the general fund side.

Even though the monies generated by the drones were placed into the general fund? Because that's what we were told.

Are you talking about the cannabis program now, or are you talking about the drone program?

Yeah, the drone program.

Yes, the drone program. I believe the fines are deposited into the general fund, yes.

All right, Commissioner Lagner. Thank you. So with Commissioner Benavidez bringing up the drones, Would it be possible to get us an update for the impact this year on that program? And Pete, I believe last year it was 65 citations at $1,500. Would it be possible for us to agendize that? to get an update on the impact this year. Moving on to the next question, when we talk about the impact of Measure Z funds, as it relates to my questions and Commissioner Ward's questions, he asked about crime. I asked about things somewhat, I don't know if DUIs and traffic violations and whatnot are considered crimes, but certainly measure of Z funds are being expended in those categories potentially with the impact. So I'm learning. So if you could address that's where I was making the connection and then third would be to your point if it's not possible to get that information the way you outlined it I would be interested if my fellow commissioners would be in getting an expanded um i guess scope of our duties because i think that those things are relevant that we at least three of the commissioners asked on that subject tonight so that's my comments very fair points and we'll um take that back and discuss those are very good points

Did you mean to press it again? No, I did not. Sorry. Commissioner Ward. I don't know what I'm doing.

Sorry. Yeah. And I think those are astute observations, Commissioner Leckner. And I'd also like to add on to some rationale for my questioning, as well, is that there are five full-time positions right now that are managing the program for Canvas right now, if I'm not correct. I think two of those are going to fall off, if my memory serves me right. But there would be three that could remain. And so those positions, I'm wondering, do they fall within the measures he's spending? And if they do, I think that that would relate as well. But if they fall within general fund, then I guess the question could be struck.

In reference to the cannabis program? Yeah. I believe those would be on the general fund site. General fund, okay.

Then I think that Commissioner Langner's question would be more relevant.

Okay, if that is all, the next regular Budget Engagement Commission meeting is scheduled for Thursday, August 13th at 5 o'clock p.m. This meeting is adjourned.