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Council adopts commercial cannabis regulatory fee schedule to cover program costs
Summary
Pacific Grove adopted a fee schedule to implement its commercial cannabis regulatory program; staff and an outside contractor (HDL) will collect application, inspection, background and annual regulatory fees designed to recover program costs.
The Pacific Grove City Council adopted a commercial cannabis regulatory fee schedule on July 16 that staff said is intended to be 100% cost‑recovery for the city’s commercial cannabis regulatory program.
City staff presented a schedule of fees that covers application processing, zone confirmation, conditional use permit processing, security and site plan review, background checks, pre‑license inspections, annual regulatory fees, annual financial audits and reinspection charges. The city has contracted with HDL to assist with application review, on‑site inspections, background processing and fee administration.
Staff estimated fee revenue of roughly $50,000 in the first year from regulatory fees (separate from future cannabis tax revenues). The city said fees will include pass‑through charges for HDL services such as background checks and security plan reviews.
Councilmember Garfield described the action as long‑awaited and said it begins a program that has been “in the works for a really long time.” Councilmembers asked procedural questions about appeal steps, the annual audit, background checks and inspection cadence; staff explained applicants will have a defined application window, HDL will screen packets before a lottery, and appeals processes exist at application and conditional use permit stages.
There was no public comment on the fee schedule. Council adopted the fee changes by unanimous voice vote. Staff said they aim to open applications starting September 15, 2025, with a 30‑day application window.
