Redondo Beach narrows cannabis rules, sets 4.5% tax and new transfer, interview and ownership standards

Redondo Beach City Council members on Tuesday moved forward with a set of revisions to the city’s draft cannabis regulatory ordinances, directing staff to prepare the ordinances for first reading with specific policy choices including a 4.5% retail tax rate and new standards for ownership transfers.

The council’s direction follows years of work that began in 2018 and an ordinance adoption process that produced several related municipal code changes (ordinance Nos. 3241-22, 3235-22 and 3240-22). Councilmembers and staff also resolved outstanding technical issues in the scoring matrix and updated the buffer map to add a newly identified preschool and coastal commercial zone information.

Council members said they sought a balance between making legal retail options available to reduce the black market and protecting youth and neighborhood character. The council’s actions set the framework that staff will incorporate into the final ordinance language and scoring materials for a planned first reading in January.

Most of the council’s discussion focused on where retail stores should be allowed, how to limit speculative value of a permit, and how to measure whether a new owner qualifies if an existing operator seeks to transfer a permit. Community concerns about proximity to schools and to Artesia Boulevard repeatedly surfaced in testimony and council remarks.

“Opening storefront cannabis shops in Redondo Beach potentially sends the wrong message of cannabis acceptance to our youth,” Councilmember Barron said during discussion about location choices; other councilmembers said the city should also consider the practical effects of pushing legal business into areas lacking parking or otherwise unsuitable for secure retail.

Key decisions and directions

- Tax rate: The council settled on a compromise tax level of 4.5% (a midpoint between earlier positions of 3% and 5%). Staff was directed to show 4.5% in the final materials the council will consider. Several councilmembers said starting at a moderate rate helps keep the legal market competitive with the illicit market while generating city revenue.

- Transfers/change of ownership: The council directed staff to retain a transfer pathway but to strengthen it. Under the direction, a permit-holder may transfer ownership after at least three years in operation only if the transferee’s application is treated and scored as a new application and the transferee attains at least the same score (or better) as the originally approved applicant. The intent is to prevent quick sales of awarded entitlements while allowing an underperforming operator to be replaced by a qualified buyer.

- Owner disclosure and interview rules: The council directed staff to require that all persons listed as owners appear on the application; those with a 20% or greater aggregate ownership interest (or persons with equivalent operational control, e.g., CEO or on-site manager) must attend the applicant interview. The council also directed staff to ensure operational staff are represented in interview materials so the selection committee can assess who will run the business on site.

- Timing to operation: Permittees will be required to obtain all land‑use approvals and be operational within 24 months of issuance of a permit. Councilmembers said the requirement helps prevent speculative awards that sit dormant.

- Scoring and interviews: The council confirmed interviews will be part of the selection process. Scoring criteria will be clarified and corrected (staff reported formatting errors after converting a matrix to Word). Staff will publish the interview questions in advance.

- Zoning and buffers: Staff updated the buffer map in the packet to add coastal commercial zone information and a recently identified Lisonbee preschool on Aviation; the council directed staff to remove a blanket “1,000‑foot from another retailer” rule that had created undesirable gaps, but to continue using detailed zoning and buffer rules. The council also directed staff to retain a limitation of no more than one retail site per council district unless future maps show otherwise.

- Cleanups and edits: Council asked staff to remove the word “distribution” from a retail operator scoring category (distribution is a separate license type), to add closing procedures to operational questions, and to change a draft reference to a “fee” so it correctly reads as a tax in the operative ordinance language.

Vote and next steps

The council recorded a final motion to give staff direction consistent with the items above; the motion carried 4–1. (The public record shows a 4–1 tally on the motion; the transcript does not attach each named member’s vote to the tally.) Staff said it will return the revised ordinances for first reading at the Jan. 21 meeting and continue drafting the application, property‑owner consent forms and the full request for proposals for eligible sites.

Why it matters

Redondo Beach has been developing a regulated cannabis retail program since 2018. Voters authorized local taxation for cannabis with Measure CT in March 2023; the council’s current work completes the local permitting rules that will decide whether future storefront operators may open, where they will locate, and how they will be held accountable. The council’s choices are intended to balance neighborhood concerns — particularly youth exposure and Artesia Boulevard impacts — with the city’s stated goal of displacing illicit storefronts with regulated retail.

What remains to be decided

Staff will return redlined ordinance language and the scoring matrix for formal adoption steps. The council asked staff to draft objective criteria the permit administrator and selection committee can use for administrative renewals and for the transfer standard so future decisions are defensible and auditable. Staff also will prepare the final buffer map and a timeline for the RFP and applicant interviews.

Community reaction and public input

Speakers at public comment were split: some residents urged the council to ban storefronts to protect youth and reduce neighborhood nuisances; others urged regulated retail to undercut illicit market sellers and to generate local jobs and tax revenue. Industry representatives and applicants described the need for a predictable, transparent scoring and licensing process. Councilmembers said public comment and targeted outreach, including community surveys and district meetings, informed their deliberations.

Ending note

Staff will return a revised ordinance package for first reading on Tuesday, Jan. 21, 2025, and expects to issue a request for proposals for eligible retail locations once the final ordinance and application materials are adopted.