Bitter Outcome for SweetFlower as Cannabis Retailer’s Bid for Prime Pasadena Location Ends in Council Chambers

SweetFlower claims City’s rules not applied fairly to all applicants; Council rejects appeal, 6-1

Published : Tuesday, October 8, 2019 | 4:43 AM

SweetFlower’s CEO Tim Dodd addresses Pasadena City Council on Monday, October 7, 2019

An appeal of a Board of Zoning Appeals decision to reject an “incomplete” cannabis retailer Conditional Use Permit application from SweetFlower Pasadena, LLC, Inc., was upheld Monday by the Pasadena City Council by a 6-1 vote, with Councilmember Tyron Hampton the lone dissenter.

Earlier, Pasadena’s Zoning Appeals Board denied the appeal by SweetFlower of a City ruling that SweetFlower had failed to provide a location map prepared by a licensed surveyor in its application packet and thus its application was eliminated from consideration. That decision was then appealed directly to the City Council.

Monday saw a four-hour-plus, sometimes testy, discussion in which the Councilmembers debated the difference between a “complete” application versus a “correct” application, the definition of a radius map, and what constituted a “best” application.

“This has been a very complicated discussion,” said Mayor Terry Tornek, just past midnight. “We knew it would be contentious. This (cannabis license) is the ‘golden ticket.’”

Tornek acknowledged the long and detailed discussion, and said, “We considered a variety of ways to handle this, none perfect. Frankly, the issue of ‘completeness’ and ‘correctness’ has left us a little baffled.”

“I have been through this process in terms of working for ‘completeness,’” he said of the appellants’ case, “and then going back and checking for ‘correctness.’ [But] I will not go against the work of the staff.”

In its appeal to the Council, appellant SweetFlower’s CEO Tim Dodd said that City staff eventually told him that SweetFlower should turn in its “best” application. Dodd also claimed that other competing applications were also incomplete” for various reasons, but were still accepted.

Pasadena’s Director of the Planning and Community Development David Reyes replied that the same standard was applied to all applications.

Despite SweetFlower introducing additional arguments and defenses, Reyes said, “This is just about securing a location, and confirming it.”

SweetFlower claimed in its appeal that their application was compliant with requirements of the Pasadena Municipal Code , and that the City Planning Director has no authority to promulgate cannabis regulations; that the standards for determination of completeness were changed a number of times, and that there was no consistency or fairness in determining the completeness of CUP applications.

Planning Director Reyes rejected all of the arguments, saying that the application was ruled ‘incomplete” because it did not contain a map prepared by a licensed surveyor, a fact which Todd eventually admitted.

Reyes also noted his authority to create the application and to identify additional submittal requirements, noting that “the Zoning Code clearly articulates that the Director is not only authorized to create application materials, but is mandated to do so.”

Finally, said Reyes in his response, “The narrow issue before the City Council this evening is whether or not the SweetFlower application was complete.”

Pasadena voters originally approved Ballot Measures CC and DD in June of 2018, which allow a limited number of cannabis businesses to operate within the City and then allowed the City to levy a business license tax on cannabis sales.

The regulations allow for three types of cannabis uses—retail, cultivation and testing laboratories. The regulations also permit up to six commercial cannabis retailers within the City limits.

The City then created a selection committee comprised of expert staff at a neutral, third-party consultant group, Hinderliter, de Llamas & Associates Companies (Hdl), to review, score and rank all initial applications.

The 31-day application filing period opened on January 1, 2019 and closed on January 31, 2020. A total of 128 applications were received, 122 of which were for the retailer category, three for the cultivation category, and three for testing laboratories, according to a staff report.

Review and scoring of the applications was completed by Hdl in May 2019 at which time the six top-scoring applicants for the retailer category were identified and invited to interviews by members of City staff.

SweetFlower Pasadena, LLC was among the six final selected applicants. The finalists then had to locate and secure a location for their shop, and then eventually file for a Conditional Use Permit (CUP) for a Cannabis Retailer.

The new permits were a brand-new land use in the City, applicants were told, at an applicant meeting, and the application included several requirements for documentation, specific to retail cannabis use.

The applicants were instructed to secure a property that met all of the City’s distance separation requirements. No retailer could be closer than 600 feet away from residential neighborhoods, churches, youth centers, playgrounds and the like.

On June 12, 2019, the same day that the CUP application was distributed to the six selected top applicants, SweetFlower Pasadena LLC was the first to submit its application. Two additional applications were received that same evening, and all three applications were for locations in Council District 3.

On June 13th, the City issued an email which told all applicants that, “As indicated on the Conditional Use Permit submittal checklist, the radius map must be prepared by a licensed surveyor…”

According to a staff report, the winning applicants, other than SweetFlower, all said that they understood the need for a licensed surveyor.

Following the City’s June 13, 2019 email, The Atrium Group, another applicant, resubmitted its CUP application and included a location map prepared by a licensed surveyor.

SweetFlower submitted a letter on June 19, 2019 asking that the City apply a “complete, in good faith standard’ in reviewing their CUP application.

SweetFlower submitted three more applications in its attempts to file a complete application for the same location at 827 East Colorado Boulevard. The appellant’s third and fourth submittal were accepted as complete, but other complete applications in Council District 3 were already submitted prior to the appellant’s third application.

BOZA rejected SweetFlowers’ application in August of 2018.

Reyes explained that because of the “unique nature” of cannabis retailers, it was important that the distance regulations be maintained, and only professional licensed surveyors could accurately measure the proper distances required—600 feet away from residentially zoned properties, properties with faith congregations, schools and libraries, and no closer than 1,000 feet from another dispensary.

In its staff report, the Planning Department wrote that, “The City has remained fair and consistent in determining whether any CUP application is or is not complete.”

“Specifically,” said the report, “in regards to the determination as to whether the required location map was prepared by a licensed surveyor, the City has uniformly required that the location maps are signed and stamped by a licensed surveyor and also include a general statement affirming, at a minimum, that the 600′ and 1000′ radii have been prepared by the undersigned licensed surveyor.”

“There was a fundamental flaw in the appellant’s application,” said Council Member Margaret McAustin, as the clock ticked toward midnight. “They missed it. Everyone knew how competitive this was. They didn’t do it, they could have done it.”

Continued McAustin, “It’s quite clear. Rules are rules. We have to be fair to everyone. There are other applicants. That is the only way to deal with this.”

Councilmember Gene Masuda agreed with McAustin, saying, “Their application was incomplete. Council might change the rules, if they don’t get six qualified applicants, later on down the line, but having filled out a lot of applications myself, if it says something should be notarized, you better have it notarized.”

Councilmember Tyron Hampton contended that none of the applicants had a complete application, saying that the applicants needed three scores. Mermell explained that the applicants were graded by a three-person independent panel at the consulting firm HdL, and later interviewed by City staff.

“HDL did a very rigorous job of grading and testing,” said Mermell.

Councilmember John Kennedy also agreed with the majority of the Council, telling Dodd, “You had a chance to comply, and you didn’t. You just missed the boat this time.”

“What we’re struggling with here is the question as to whether we are applying the same standards to every applicant,” said Councilmember Victor Gordo.

“Was everybody significantly clear?,” Gordo asked. Reyes told the Council several times that the rules were applied the same way to all the applicants.