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HomeMy WebLinkAboutAGENDA REPORT 2020 1118 CCSA REG ITEM 09ACITY OF MOORPARK, 
CALIFORNIA City Council Meeting of November 18, 2020 ACTION Approved Staff Recommendation (Roll Call Vote: Unanimous). BY B.Garza. A. Consider 10-Day Report on the Measures Taken to Alleviate the Conditions which Led to the City Council’s Adoption of Interim Urgency Ordinance No. 477 that Established the Current Moratorium On Certain Industrial Hemp Uses and its Subsequent Extension for an Additional 10 Months and 15 Days, In Conjunction with a Proposed Extension of the Moratorium Through and Including December 16, 2021. Staff Recommendation: Approve the issuance of the 10-Day Report regarding Interim Urgency Ordinance No. 477 that imposed a moratorium on the cultivation, manufacturing, testing, storing, and certain retail sales of industrial hemp. (Staff: Shanna Farley-Judkins) Item: 9.A. MOORPARK CITY COUNCIL AGENDA REPORT TO: Honorable City Council FROM: Karen Vaughn, Interim Deputy City Manager BY: Shanna Farley-Judkins, Principal Planner DATE: 11/18/2020 Regular Meeting SUBJECT: Consider 10-Day Report on the Measures Taken to Alleviate the Conditions w hich Led to the City Council’s Adoption of Interim Urgency Ordinance No. 477 that Established the Current Moratorium On Certain Industrial Hemp Uses and its Subsequent Extension for an Additional 10 Months and 15 Days, In Conjunction with a Proposed Extension of the Moratorium Through and Including December 16, 2021 BACKGROUND/DISCUSSION On December 18, 2019, pursuant to Government Code Section 65858 (“Section 65858”), the Moorpark City Council enacted a 45-day Interim Urgency Ordinance to impose a moratorium on the cultivation, manufacturing, testing, storing, and certain retail sales of industrial hemp. The Interim Urgency Ordinance was initially scheduled to expire on February 1, 2020. The City Council then held a noticed public hearing on January 15, 2020, to extend the Interim Urgency Ordinance for an additional 10 months and 15 days through December 16, 2020, when it is currently scheduled to expire. Under Section 65858, the City Council may extend the moratorium one final time for up to one year. Staff anticipates additional time will be necessary to thoroughly research and evaluate a permanent, non-urgency ordinance establishing zoning regulations and other restrictions on the cultivation, manufacturing, testing, sale, and storing of industrial hemp. City staff also anticipates that additional time will be necessary to study the sale of cannabidiol (CBD) products and the operation of stores that specialize in the sale of hemp products. Therefore, staff is proposing to extend the moratorium for one year to December 16, 2021. Item: 9.A. 12 Honorable City Council 11/18/2020 Regular Meeting Page 2 Section 65858(d) states: “Ten days prior to the expiration of that interim ordinance or any extension, the legislative body shall issue a written report describing the measures taken to alleviate the condition which led to the adoption of the ordinance.” Staff anticipates scheduling a public hearing for December 2, 2020, where the City Council will consider the moratorium’s final extension. Therefore, this “10-day” report is proposed to be issued at the City Council’s Regular Meeting on November 18, 2020, or 14 days before the proposed extension. The attached draft 10-Day Report describes the measures taken to alleviate the conditions which led to the adoption of the Interim Urgency Ordinance on industrial hemp uses and what steps staff continues taking to develop new permanent regulations of industrial hemp. FISCAL IMPACT None. COUNCIL GOAL COMPLIANCE This action does not support a current strategic directive. STAFF RECOMMENDATION Approve the issuance of the 10-Day Report regarding Interim Urgency Ordinance No. 477 that imposed a moratorium on the cultivation, manufacturing, testing, storing, and certain retail sales of industrial hemp. Attachment: 10-Day Report Regarding Moratorium on Industrial Hemp Uses 13 ATTACHMENT REPORT ON THE MEASURES TAKEN TO ALLEVIATE THE CONDITIONS WHICH LED THE CITY OF MOORPARK TO ENACT INTERIM URGENCY ORDINANCE NO. 477 ON DECEMBER 18, 2019, WHICH WAS SUBSEQUENTLY EXTENDED TO DECEMBER 16, 2020, TO IMPOSE A MORATORIUM ON THE CULTIVATION, MANUFACTURING, TESTING, STORING, AND CERTAIN RETAIL SALES OF INDUSTRIAL HEMP ISSUED BY THE CITY COUNCIL OF THE CITY OF MOORPARK ON NOVEMBER 18, 2020 PURSUANT TO GOVERNMENT CODE SECTION 65858(d) Background: On December 18, 2019, pursuant to Government Code Section 65858, the Moorpark City Council enacted an Interim Urgency Ordinance to impose a moratorium on the cultivation, manufacturing, testing, storing, and certain retail sales of industrial hemp. The Interim Urgency Ordinance was originally scheduled to expire after 45 days (February 1, 2020). However, additional time was necessary to thoroughly research and evaluate a permanent, non-urgency ordinance establishing zoning regulations and other restrictions on the cultivation, manufacturing, testing, sale, and storing of industrial hemp. Therefore, on January 15, 2020, the City Council extended the Interim Urgency Ordinance from February 1, 2020 for an additional 10 months and 15 days, through and including December 16, 2020. City staff anticipates that additional time will be needed to complete its work on a permanent, non-urgency ordinance to establish appropriate regulations and other restrictions relating to industrial hemp. A public hearing will be scheduled for December 2, 2020, to consider a further extension of the Interim Urgency Ordinance from December 16, 2020, for an additional year to December 16, 2021. Reasons for the Interim Ordinance and Its Extensions: The Interim Ordinance was adopted for the following reasons: A. Cultivation, Manufacturing, Testing and Storing of Industrial Hemp. In 2019, large numbers of residents in the Peach Hill, Mountain Meadows, Serenata and other areas and neighborhoods in the southern portion of the City experienced offensive odors from relatively new and large-scale outdoor industrial hemp farms located in the Tierra Rejada Valley located immediately south of the City in the unincorporated area of the County of Ventura. Dozens of residents called City and County officials complaining of the continual skunk-like odor in their neighborhoods as terpenes from a large farm of industrial hemp grown to produce CBD oil wafted into residential neighborhoods adjacent to this hemp farm. Aside from having to experience offensive odors, many of these residents also complained of headaches, nausea, sore 12853-0001\2469135v4.doc 14 Ten-Day Report - Ordinance No. 477 Page 2 throats and other physical side effects from breathing and smelling the distinctive odor generated by industrial hemp grown to produce CBD oil. Additional concerns were raised about the volatile organic compounds (VOC) generated by industrial hemp plants and whether large-scale production of industrial hemp could lead to the increased generation of smog-producing ozone in Ventura County. Public safety concerns were also raised. Ventura County Sheriff’s Captain Victor Fazio, reported on the increased number of crimes committed by persons seeking to steal industrial hemp plants from open and unsecured fields, the collateral crimes committed in the course of those thefts, and the criminal element that is being attracted into Ventura County to take advantage of these opportunities for theft. B. CBD Products. After the 2018 Farm Bill was signed into law, the Food and Drug Administration (“FDA”) released a statement stating that it is unlawful under the Food, Drug, and Cosmetics Act (“FD&C”) to introduce food containing added CBD into interstate commerce, or to market CBD products as, or in, dietary supplements, regardless of whether the CBD was derived from industrial hemp or from cannabis. Similarly, the California Department of Public Health released a statement explaining that the use of industrial hemp as the source of CBD to be added to food products is prohibited. The California Department of Public Health explained that until the FDA rules that industrial hemp-derived CBD oil and CBD products can be used as a food or California makes a determination that they are safe to use for human and animal consumption, CBD products are not an approved food, food ingredient, food additive, or dietary supplement. The FDA has approved only one CBD product, Epidiolex, a prescription drug product to treat two rare, severe forms of epilepsy. The moratorium will not ban the sale of Epidiolex. Under the FD&C, any product intended to have a therapeutic or medical use, and any product (other than a food) that is intended to affect the structure or function of the body of humans or animals, is a drug. Drugs must generally either receive premarket approval by the FDA through the New Drug Application process or conform to a "monograph" for a particular drug category, as established by FDA's Over-the-Counter (“OTC”) Drug Review. CBD is not an ingredient considered under the OTC drug review. An unapproved new drug cannot be distributed or sold in interstate commerce. There are no FDA approved products that contain CBD other than Epidiolex. Therefore, the sale of CBD products that are intended to have a therapeutic or medical use is a violation of federal law, and as discussed below, can pose a significant risk to the public. In addition, the FDA has concluded that CBD cannot be sold as a dietary supplement. The FDA has also concluded that it is a prohibited act to introduce or deliver for introduction into interstate commerce any food (including any animal food or feed) to 12853-0001\2469135v4.doc 15 Ten-Day Report - Ordinance No. 477 Page 3 which CBD has been added.1 Unlike the FDA-approved CBD drug product, unapproved CBD products, which could include unapproved drugs, cosmetics, foods, and products marketed as dietary supplements, have not been subject to FDA evaluation regarding whether they are effective to treat a particular disease or have other effects that may be claimed. In addition, they have not been evaluated by the FDA to determine what the proper dosage is, how they could interact with other drugs or foods, or whether they have dangerous side effects or other safety concerns. Misleading, unproven, or false claims associated with CBD products may lead consumers to put off getting important medical care, such as proper diagnosis, treatment, and supportive care, which is a real public health and safety concern. The FDA notes that it has seen only limited data about CBD safety and the data points to real risks that need to be considered before taking CBD for any reason. According to the FDA, CBD has the potential to cause liver injury, and can affect the metabolism of other drugs, causing serious side effects. Use of CBD with alcohol or other Central Nervous System depressants increases the risk of sedation and drowsiness, which can lead to injuries. CBD can also cause changes in alertness, most commonly experienced as drowsiness or sleepiness, gastrointestinal distress, most commonly experienced as diarrhea and/or decreased appetite, and changes in mood, most commonly experienced as irritability and agitation. In addition to safety risks and unproven claims, the quality of many CBD products may also be in question. The FDA has raised concerns about the lack of appropriate processing controls and practices that can put consumers at additional risk. For example, the FDA has tested the chemical content of cannabinoid compounds in some of the products, and many were found to not contain the levels of CBD they claimed. The FDA is also investigating reports of CBD potentially containing unsafe levels of contaminants (e.g., pesticides, heavy metals, and THC). A cosmetic is defined in Section 201(i) of the FD&C Act as "(1) articles intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to the human body or any part thereof for cleansing, beautifying, promoting attractiveness, or altering the appearance, and (2) articles intended for use as a component of any such articles; except that such term shall not include soap." Under the FD&C Act, cosmetic products and ingredients are not subject to premarket approval by FDA, except for most color additives. Ingredients not specifically addressed by regulation must nonetheless comply with all applicable requirements, and no ingredient – including a cannabis or cannabis-derived ingredient – can be used in a cosmetic if it causes the product to be adulterated or misbranded in any way. A cosmetic generally is adulterated if it bears or contains any poisonous or deleterious substance which may render it injurious to users under the conditions of use prescribed in the labeling, or under such conditions of use as are customary or usage. If a product is intended to affect the structure or function of 1 Ingredients that are derived from industrial hemp that do not contain THC or CBD might be able to be added to food. In December 2018, the FDA determined that hulled hemp seed, hemp seed protein powder, and hemp seed oil can be legally marketed in human foods for consumption as marketers do not make claims that they treat disease. These products do not fall within the City’s categorical ban. 12853-0001\2469135v4.doc 16 Ten-Day Report - Ordinance No. 477 Page 4 the body, or to diagnose, cure, mitigate, treat or prevent disease, it is a drug, or possibly both a cosmetic and a drug, even if it affects the appearance. As part of staff’s comprehensive investigation of industrial hemp and its potential impacts on public health, safety, and welfare, staff continues to evaluate whether and to what extent retail sales of CBD products contribute to any such health and safety impacts. C. Hemp Retail Stores. Other cities in Ventura County have also seen an increase in stores specializing in the sale of hemp products, such as CBD. In order to comprehensively review the appropriateness of this type of focused retail store to be located in the City and in certain types of commercial districts of the City, the City wants to consider a range of zoning and other regulatory options that may pertain to these types of retail stores. The City continues to study a potential exemption for certain types of hemp products from the definition of what would constitute a non-permissible hemp store. Based on these and other concerns expressed by the public and described in the staff report for the December 18, 2019 City Council meeting, the City Council adopted Ordinance No. 477 to impose a moratorium on: (1) the cultivation, manufacturing, testing and storing of industrial hemp in the City; (2) the retail sale of unapproved CBD products; and (3) the establishment of hemp stores in the City. Then, on January 15, 2020, the City Council extended the Interim Urgency Ordinance from February 1, 2020 for an additional 10 months and 15 days, through and including December 16, 2020 to provide additional time for the City to study appropriate regulations and restrictions on the above-referenced cultivation and uses of industrial hemp. The City Council is now considering a final extension of the Interim Urgency Ordinance for an additional year to December 16, 2021. Measures Taken to Alleviate the Conditions Which Led to the Adoption of the Ordinance: • On June 15, 2020, staff presented an Industrial Hemp Study Session agenda item to the City Council. Staff shared initial research that had been conducted on the types of uses that might be expected and associated with industrial hemp, which included warehousing, manufacturing, testing and retail hemp uses. Staff outlined their initial analysis and potential regulatory options to the City Council, considering both positive and negative impacts that might be generated by such uses. The City Council discussed and commented on particular uses and requested additional analysis be conducted to address their comments and concerns. Although the City Council provided comments and guidance, further background research is necessary to substantiate specific regulations and address additional concerns raised by the City Council on the substantive impacts of hemp storage, transportation and sale. 12853-0001\2469135v4.doc 17 Ten-Day Report - Ordinance No. 477 Page 5 • Staff has prepared a draft ordinance to prohibit the cultivation of industrial hemp within the City boundary. Although a draft ordinance was initially scheduled for review by the City Council on July 15, 2020, the item was rescheduled to September 2, 2020 and has since been taken off the City Council calendar so staff can continue to evaluate regional regulations relating to industrial hemp. Due to potential revisions to hemp cultivation regulations in the surrounding unincorporated areas, staff intends to present the draft regulations to City Council following action by the County of Ventura and the final results of the vote on Ventura County Measure O (discussed below). • The County of Ventura has proposed an interim ordinance to create a one- half mile buffer between sensitive receptors and industrial hemp cultivation activities carried out in unincorporated County land. The County’s proposed interim Ordinance was considered at the Board of Supervisors meeting on January 14, 2020. The City submitted a letter asking that the County develop a science-based standard for separation between residences and other sensitive uses and hemp cultivation areas. The City is concerned that with wind patterns, both on-shore and off-shore flows, the separation needed to ensure that residents are not subjected to objectionable odors may need to be greater than one-half mile. City staff continued to monitor and review the draft regulations throughout the spring and summer of 2020. On July 15, 2020, the County of Ventura, Agricultural Commission reviewed a draft proposed ordinance to address concerns related to industrial hemp cultivation. The draft ordinance was presented to the Ventura County Planning Commission on November 5, 2020. City staff reviewed the proposed ordinance and provided testimony regarding the concerns previously identified by the community. Staff will also consider the impact of the County’s proposed regulations on the City’s eventual regulations. • On November 3, 2020, voters in Ventura County voted on County Ballot Measure O, a measure which if approved would allow commercial cultivation, processing, distribution and sale of cannabis in certain areas of the County. Preliminary returns show Measure O passed with a vote of 57% to 43%. Since the measure is approved by a simple majority vote, the ordinance implementing the new regulations would go into effect on January 21, 2021. Although the subject of this moratorium is related to industrial hemp and not cannabis, both Measure O and the County’s proposed hemp ordinance may have impacts that should be considered in the development of City regulations, therefore staff intends to consider the two actions prior to continued preparation of a draft City ordinance. • City staff has continued to confer with the Ventura County Sheriff’s Department in order to better understand the causes of additional criminal activity surrounding industrial hemp activities and what type of security 12853-0001\2469135v4.doc 18 Ten-Day Report - Ordinance No. 477 Page 6 measures are needed to avoid hemp uses from being a magnet for criminal theft of hemp plants. • City staff has continued to monitor and research the current regulatory environment surrounding CBD products that have not yet been approved for human consumption by the Federal Drug Administration. Staff is undertaking this research to determine whether, in the absence of a robust and well- understood federal regulatory program, municipal permanent restrictions on CBD productions are appropriate. • City staff has continued to research specific impacts associated with odor related to manufacturing and industrials uses, as suggested by City Council. Staff intends to make site visits to facilities where hemp is processed in surrounding communities, to better understand the potential impacts of such uses. • Assuming the City Council elects to extend the Interim Urgency Ordinance, and thereafter amends the Moorpark Municipal Code to address the subjects of this report, staff would at that time recommend rescinding the Interim Urgency Ordinance upon the effective date of the new regulations prior to December 16, 2021. 12853-0001\2469135v4.doc 19