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Date: |
August 19, 2026, and September 2, 2026 |
03 |
Title
Socially Equitable Cannabis Program - Amendments to the County Zoning Ordinance and Code of Regulatory Ordinances, with Certification of Final Program Environmental Impact Report, CEQA Findings and Associated Permitting and Licensing Fees (POD-21-001; ER-22-00-002) (08/19/2026 - First Reading; 09/02/2026 - Second Reading) (Districts: All)
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Overview
This is a request for the County of San Diego (County) Board of Supervisors (Board) to consider the adoption of the Socially Equitable Cannabis Program (SECP), which establishes a framework to allow and regulate commercial cannabis facilities in the unincorporated area. The SECP would enable the permitting and licensing of cannabis facilities, implement a Social Equity Program (SEP), and establish associated regulatory, enforcement, and funding mechanisms, which includes a Board Policy to ensure minimum funding for enforcement related to illicit and unlicensed cannabis activities. This action advances prior Board direction from January 27, 2021 (4), June 9, 2021 (2), June 15, 2022 (7), April 30, 2024 (31), and January 14, 2026 (3), which directed the Chief Administrative Officer (CAO) to create a legal, regulated, and socially equitable cannabis framework. The Board directed staff to establish clear and consistent standards for the siting and permitting of cannabis facilities, align local regulations with State law, engage stakeholders throughout program development, transition from an unregulated market to a safe and legally compliant system, and implement an SEP to promote equitable access to cannabis business opportunities for those disproportionately impacted by past cannabis criminalization.
The Draft SECP implements the Board's direction by allowing a range of commercial cannabis facilities in the unincorporated area, including cultivation, manufacturing, distribution, testing, microbusinesses, retail non-storefront (delivery), retail storefronts (dispensaries), consumption lounges, and temporary events. The program establishes a maximum of 25 retail storefront facilities and does not place a cap on other license types. All cannabis facilities would be required to maintain a minimum 600-foot buffer from schools, day cares, and youth centers, consistent with State law.
The SEP, led by the Office of Equity and Racial Justice (OERJ), is a core component of the SECP and is intended to promote fair access to cannabis business opportunities. The Board previously adopted Social Equity Criteria Tiers, provided direction on the Cannabis Social Equity Ordinance, and directed the continued development of the Community Equity Contribution Program, which could offer rebates or grants to cannabis facilities that provide community benefits and are current on their cannabis taxes.
The SECP would allow cultivation facilities in agricultural zones; manufacturing, distribution, and testing facilities in industrial zones; and temporary events and retail facilities, including consumption lounges, in commercial and industrial zones. Consumption lounges would be permitted only as part of a retail facility. Microbusinesses would be allowed in agricultural, industrial, and commercial zones, with limited cultivation and retail options.
Under this framework, the environmental review of the proposed program identified several significant and unavoidable impacts, including effects on aesthetics, air quality (odor), groundwater, utilities and service systems (adequate water supplies), temporary construction-related noise, and transportation. Today’s action includes a request to adopt the California Environmental Quality Act (CEQA) Findings of Fact and Statement of Overriding Considerations (SOC) pertaining to these impacts, provided in Attachment A.
To implement the SECP, staff requests that the Board consider:
(1) certifying the Final Program Environmental Impact Report (PEIR), and adopting the associated CEQA Findings of Fact, the Mitigation Monitoring and Reporting Program, and SOC;
(2) consider amendments to the County Zoning Ordinance to allow for new cannabis facilities in certain agricultural, commercial, and industrial zones, amendments to the County Code of Regulatory Ordinances to establish cannabis licensing, operations, and enforcement, and establish a Social Equity Ordinance to promote fair access for individuals adversely impacted by cannabis criminalization;
(3) amend the fee schedule to establish permitting and licensing fees; and
(4) adopt a Board Policy to establish minimum funding requirements for cannabis related code and law enforcement, consistent with the Board’s prior direction on June 15, 2022 (7).
If the Board adopts staff recommendations today, a second reading to adopt the Code of Regulatory Ordinances, the Social Equity Ordinance, and related licensing and permitting fees would be required on September 2, 2026.
Body
Recommendation by Planning Commission:
On April 10, 2026, the County of San Diego Planning Commission voted 4-1-0-2 (Ayes: Edwards, Ashman, Pallinger, Calvo; Noes: Sabellico; Abstained: 0; Absent: Weber, Sudberry) to recommend that the County Board of Supervisors:
1) Certify the Final Program Environmental Impact Report, dated March 2026, on file with Planning & Development Services as Environmental Review Number PDS2022-ER-22-00-002, and find that it was completed in compliance with the California Environmental Quality Act (CEQA) and the State and County CEQA Guidelines.
2) Adopt CEQA Findings of Fact which include the findings regarding significant effects of the SECP, the Statement of Overriding Considerations, and the Mitigation Monitoring and Reporting Program that are consistent with the Commission’s recommendation.
3) Adopt amendments to the Zoning Ordinance with the following modifications:
a. Prohibit outdoor cultivation
b. All cannabis facility types would be required to maintain a minimum 1,000-foot buffer from schools, day cares, youth centers, public parks, public trails, and places of worship.
c. Allow informational and educational events, as allowed by the California Department of Cannabis Control at cannabis facilities.
Recommendation by Department of Planning & Development Services:
Following the January 14, 2026 (3) Board of Supervisors (Board) direction, Planning & Development Services (PDS) recommends that on August 19, 2026, the Board take the following action:
1) Adopt the California Environmental Quality Act (CEQA) Findings of Fact which include the findings regarding significant effects of the Socially Equitable Cannabis Program, the Statement of Overriding Considerations, and the Mitigation Monitoring and Reporting Program, as well as certify the Final Program Environmental Impact Report, dated March 2026, on file with PDS as Environmental Review Number PDS2022-ER-22-00-002, and find that it was completed in compliance with CEQA and the State and County CEQA Guidelines and that the Board has reviewed and considered the information contained therein (Attachment A).
2) Adopt the amendments to the Zoning Ordinance to allow for the permitting of new cannabis facilities in the unincorporated area:
An Ordinance Amending the County of San Diego Zoning Ordinance Related to Commercial Cannabis Regulations (POD-21-001) (Attachment B and Attachment C [Changes Shown]).
3) Approve the introduction of the amendments to the County Code of Regulatory Ordinances (first reading):
An Ordinance Amending the County of San Diego Code of Regulatory Ordinances Related to Commercial Cannabis Licensing and Operating Permits (POD-21-001) (Attachment D and Attachment E [Changes Shown]).
4) Approve the introduction of the amendments to the County Code of Regulatory Ordinances (first reading) for the Social Equity Program:
An Ordinance to Add Chapter 29 to Division 1 Business Regulations, of Title 2 Licenses, Business Regulations and Business Taxes to Amending the County of San Diego Code of Regulatory Ordinances Relating Related to the Cannabis Social Equity Program (Attachment F).
5) Approve the introduction of the amendments to the PDS Fee Schedule (first reading):
An Ordinance Amending Article XX, Section 362.1 of the San Diego County Code of Administrative Ordinances Relating to Department of Planning & Development Services Fee Schedule (POD-21-001) (Attachment G and Attachment H [Changes Shown]).
6) Adopt Board Policy B-076: Minimum Funding Requirement for Unlicensed Cannabis Enforcement (Attachment I).
If on August 19, 2026, the Board takes the actions recommended above, then on September 2, 2026, the Board would take the following actions:
1) Adopt the amendments to the County Code of Regulatory Ordinances (second reading):
An Ordinance Amending the County of San Diego Code of Regulatory Ordinances Related to Commercial Cannabis Licensing and Operating Permits (POD-21-001) (Attachment D and Attachment E [Changes Shown]).
2) Adopt the amendments to the County Code of Regulatory Ordinances (second reading) for the Social Equity Program:
An Ordinance to Add Chapter 29 to Division 1 Business Regulations, of Title 2 Licenses, Business Regulations and Business Taxes to Amending the County of San Diego Code of Regulatory Ordinances Relating Related to the Cannabis Social Equity Program (Attachment F).
3) Adopt the amendments to the PDS Fee Schedule (second reading):
An Ordinance Amending Article XX, Section 362.1 of the San Diego County Code of Administrative Ordinances Relating to Department of Planning & Development Services Fee Schedule (POD-21-001) (Attachment G and Attachment H [Changes Shown]).
The Planning Commission’s (Commission) recommendation differs significantly from the Board’s direction on January 14, 2026 (3). The Commission recommended stricter safeguards including a prohibition on outdoor cultivation, the addition of three new sensitive uses (public parks, public trails, and places of worship), and the expansion of the sensitive use buffer from 600-feet to 1,000-feet. Any direction which significantly departs from previous Board direction will require additional hearings to consider updated CEQA documentation and ordinances.
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Equity Impact Statement
On January 27, 2021 (4), the Board of Supervisors (Board) directed the Chief Administrative Officer (CAO) to develop the Socially Equitable Cannabis Program (SECP) with the goal of creating a safe and equitable legal cannabis industry in the unincorporated area. A core component of the SECP is the Social Equity Program, which seeks to rectify the injustices caused by the War on Drugs by ensuring individuals disproportionally impacted by cannabis criminalization have priority access to business opportunities. Today’s proposed actions include granting social equity applicants a three-year head start to obtain a cannabis license, requiring at least 50% of storefront retail dispensaries to be reserved for social equity applicants, establishing a limit of 25 total storefront retail dispensaries with no limit on other license types, and mandating 51% ownership by social equity applicants to maintain social equity business status. These actions aim to promote equity by ensuring social equity applicants have meaningful access to cannabis business opportunities and by supporting them in maintaining ownership and their share over time.
Sustainability Impact Statement
Today’s proposed actions to consider the Socially Equitable Cannabis Program (SECP) support several of the County of San Diego’s Sustainability Goals. Throughout the development of the SECP, staff collaborated closely with regulatory agencies, technical advisory groups, and the public to ensure alignment with environmental standards and best practices (Goal #1). The Social Equity Program aims to provide just and equitable access to the legal cannabis industry (Goal #2). The Final Program Environmental Impact Report includes the preparation of a Mitigation Monitoring and Reporting Program to minimize adverse environmental impacts that could result from future projects, including odor impacts, water availability, compliance with the Climate Action Plan, and biological resources (Goals #4 and #7). All cannabis facilities would be required to conform to the County of San Diego General Plan, any applicable specific plans and master plans, and all applicable zoning and regulatory standards and State regulations.
Fiscal Impact
Recommendations 1-3 & 6
There is no fiscal impact associated with recommendations 1, 2, 3, and 6. There will be no change in net General Fund cost and no additional staff years. In accordance with Board Policy B-29, departments are directed to seek full cost recovery for programs proposed, to the extent possible. These recommendations will achieve full cost recovery if approved by the Board of Supervisors (Board).
Recommendation 4
There are no costs anticipated in Fiscal Year 2026-27 for the Community Equity Contribution Program (CECP). The estimated ongoing costs are $20,000 per year, beginning in Fiscal Year 2027-28. Costs and revenue for CECP will be included in future Operational Plans, beginning in Fiscal Year 2027-28, based on existing General Purpose Revenue in the Office of Equity and Racial Justice allocated to the Social Equity Program. Costs are not projected to begin until Fiscal Year 2027-28, because to qualify for the CECP, new cannabis facilities must be operational and be up to date on tax payments for one year. It is projected to take one to two years to complete the State and County licensing processes. There will be no change in net General Fund costs and no additional staff years.
Recommendation 5
The funding source for all licensing fees and land use permit fees will be paid by the Cannabis License holder. There will be no change in net General Fund costs and no additional staff years. Board Policy B-29 would apply to Planning & Development Services licensing activities, and a waiver is not proposed. To maintain full cost recovery, the fees will be reviewed and adjusted annually based on the approved hourly rates under the Land Development Cost Recovery package.
The Auditor and Controller has reviewed and approved the methodology and supporting documentation used to determine the proposed hourly rates, fees, and deposits in this proposal. The Auditor and Controller found that the methodology used is consistent with Board Policy B-29 and in conformance with existing cost policies and procedures.
Business Impact Statement
Adopting the Socially Equitable Cannabis Program would allow for the permitting of commercial cannabis operations in the unincorporated areas, providing new business opportunities as part of a regulated cannabis industry. New permits could be issued for cultivation, manufacturing, distribution, testing, microbusinesses, retail, consumption lounges, and temporary cannabis events. Individual applicants may qualify for a streamlined California Environmental Quality Act (CEQA) review if their project activities fall within the scope analyzed in the Program Environmental Impact Report. Certain projects may qualify for a ministerial permitting pathway, which can be a less expensive and simpler pathway to obtaining a land use permit. New cannabis facilities also have the potential to create workforce opportunities in areas such as retail, farming, laboratory work, and manufacturing. Additionally, the Social Equity Program provides business and technical assistance to social equity applicants, enabling new business ownership opportunities by reducing barriers to entry.
Cannabis businesses support a wide variety of other businesses that are not a part of the cannabis supply chain. Cultivators support garden supply stores, greenhouse manufacturers, irrigation suppliers, soil manufacturers, and a wide variety of contractors, including building and construction, lighting and electrical, HVAC, permitting, and engineering. Manufacturers support many of these same businesses, as well as specialized tooling and equipment manufacturers, and product suppliers for hardware, packaging, and labeling. All potential cannabis businesses support, and are supported by, a host of ancillary businesses, such as bookkeepers, accountants, tax preparers, parcel services, marketing and advertising agencies, personnel services, attorneys, mechanics, facilities maintenance, security services, and others. The profits from the cannabis business and the salaries paid to employees will flow into the local economy, supporting stores, restaurants, car dealerships, contractors, and other businesses.
Advisory Board Statement
N/A
Involved Parties
This is a County of San Diego initiated project.
Planning Commission Vote
On April 10, 2026, the County of San Diego Planning Commission (Commission) considered components of the Socially Equitable Cannabis Program (SECP), including the proposed amendments to the County of San Diego Zoning Ordinance and Final Program Environmental Impact Report (PEIR). The Commission has specific authority to make formal recommendations regarding land-use decisions. Other matters relating to the County of San Diego Code of Regulatory Ordinances, as well as permitting and licensing fees, were presented to the Commission for awareness of the larger program.
The Commission voted 4-1-0-2 (Ayes: Edwards, Ashman, Pallinger, Calvo; Noes: Sabellico; Abstained: 0; Absent: Weber, Sudberry) to recommend that the Board of Supervisors certify the Final PEIR, dated March 2026 and find that it was completed in compliance with the California Environmental Quality Act (CEQA), adopt CEQA Findings, the Statement of Overriding Considerations and the Mitigation Monitoring and Reporting Program, consistent with the Commission’s recommendation, and to adopt amendments to the Zoning Ordinance with the following modifications:
• Prohibit outdoor cultivation
• Require all cannabis facilities to maintain a minimum 1,000-foot buffer from schools, day cares, youth centers, public parks, public trails, and places of worship
• Allow informational and educational events, as allowed by the California Department of Cannabis Control at cannabis facilities
Background
In 2016, California Proposition 64 decriminalized recreational cannabis for adults over 21 years of age. To date, there are five existing nonconforming cannabis facilities with valid Operating Certificates in the unincorporated area. On March 15, 2017 (2) and March 22, 2017 (6), the Board of Supervisors (Board) amended and repealed the County of San Diego (County) Zoning Ordinance related to medical and non-medical cannabis facilities within the unincorporated area. This included a moratorium on establishing new cannabis facilities. Following the State’s legalization of adult-use cannabis, local governments with land use authority were empowered to decide how to regulate commercial cannabis in their communities. Since 2021, the Board has taken several steps to establish a safe, equitable, and environmentally responsible cannabis industry in the unincorporated area.
On January 27, 2021 (4), the Board directed the Chief Administrative Officer (CAO) to develop the Socially Equitable Cannabis Program (SECP) to allow for the establishment of new cannabis facilities in the unincorporated area. The Board directed the CAO to develop the SECP in accordance with State requirements, which mandates that all facilities be located outside of a 600-foot buffer from State-defined sensitive uses including schools, day cares and youth centers.
Planning & Development Services (PDS) leads three of the four components that make up the SECP, including: 1) proposed regulatory requirements, including amendments to the County Zoning Ordinance and the Code of Regulatory Ordinances, 2) proposed licensing and permitting structure and procedures, and 3) a Program Environmental Impact Report (PEIR) to analyze potential environmental impacts from the program, directed by the Board on June 9, 2021 (2).
On June 15, 2022 (7), the Board expanded its direction to analyze 16 additional measures into the SECP that go beyond the State minimum requirements. This direction was in response to community concerns that were raised, intended to address potential impacts that cannabis facilities could have on unincorporated communities. Fourteen of the 16 measures were addressed and reported back to the Board, as of January 14, 2026 (3). Today’s recommendations address the remaining two outstanding measures: Measure 9 calls for the establishment of a Community Equity Contribution Program (CECP) to allow cannabis facilities to provide benefits to surrounding neighborhoods; and Measure 16 calls for the adoption of a Board Policy at the time of SECP consideration, establishing minimum funding requirements for code and law enforcement to address unlicensed cannabis activities. This Policy is brought forward for the Board’s consideration today.
On January 14, 2026 (3), the Board reaffirmed its original direction to proceed with regulations mirroring State requirements, which would allow a range of commercial cannabis uses, including cultivation, manufacturing, distribution, testing, microbusinesses, retail, consumption lounges, and temporary cannabis events, and requires a 600-foot buffer from schools, day cares, and youth centers. The Board also directed that temporary events and on-site consumption lounges be retained as part of the SECP, and that amendments to the Code of Regulatory Ordinances be drafted to rely solely on the State’s background check process for the issuance of a local Cannabis Business License.
The fourth component of the SECP is the Social Equity Program (SEP), led by the Office of Equity and Racial Justice (OERJ), aiming to promote fair access to the cannabis industry for those who have been impacted by cannabis-related criminalization and the War on Drugs. On April 30, 2024 (31), the Board received an update on the development of the SEP, which provides training, one-on-one mentorship, record expungement assistance, grant opportunities, and workforce development assistance. The Board approved eligibility criteria tiers and established the Cannabis Oversight Community Collaborative. The Board also provided policy direction on the Social Equity Ordinance, including a three-year head start for social equity applicants to obtain a cannabis license. The Board also established that a minimum of 50% of storefront retail facilities would be reserved for social equity applicants, with a limit of 25 total storefront retail facilities in the unincorporated area. To maintain a social equity business status, the business must have 51% ownership by social equity applicants. At the January 14, 2026 (3) meeting, the Board directed the CAO to continue to develop the CECP as part of the SEP, which is a voluntary program that would allow cannabis businesses that provide a community benefit to apply for and receive rebates or grants based on being up to date on their cannabis taxes for at least one year. The CECP is also included in the Social Equity Ordinance.
To reflect the Board’s latest direction, staff prepared amendments to the County Zoning Ordinance and Code of Regulatory Ordinances to allow future licensing and permitting of new cannabis facilities consistent with State law and PEIR Alternative 2. These would allow cannabis cultivation, manufacturing, distribution, testing, microbusinesses, retail, consumption lounges, and temporary cannabis events, all of which would require a 600-foot buffer from schools, day cares, and youth centers. As part of adopting the SECP, the Board is requested to adopt the attached Zoning Ordinance (Attachments B and C) and Code of Regulatory Ordinances amendments (Attachments D and E), approve the licensing and permitting fees (Attachments G and H), adopt the Board Policy for code and law enforcement (Attachment I), and certify the Final PEIR along with the associated California Environmental Quality Act (CEQA) Findings of Fact, the Mitigation Monitoring and Reporting Program (MMRP), and Statement of Overriding Considerations (SOC) (Attachment A). Implementation of the SEP component requires adoption of the Social Equity Ordinance (Attachment F), which includes the CECP.
Zoning Ordinance Amendments
The SECP includes amendments to the Zoning Ordinance to allow for new cannabis facilities (Attachments B and C). The draft amendments include development standards that will limit cannabis facilities to certain agricultural, commercial, and industrial zones based on the facility type. All facilities must, at a minimum, be located outside a State-mandated 600-foot buffer from sensitive uses, including schools, daycares, and youth centers. The draft amendments set performance standards applicable to all cannabis facility types for lighting, fencing, noise, historic resources, biological resources, odor, transportation, and water use, among others. Activity-specific standards are proposed and would apply to certain facility types to address potential impacts arising from their unique operational activities. For example, cultivation would have certain impacts that are not anticipated at other facilities. These activity-specific standards are crafted to ensure that appropriate measures are proposed to address the range of impacts from the different facility types.
The Zoning Ordinance amendments define permit requirements for cannabis facilities based on the facility's size and type. Facilities could either be processed ministerially with a Zoning Verification Permit (ZVP) or as a discretionary project, which would require an Administrative Permit. A ZVP is a ministerial permit type and is approved by the Director of PDS. Facilities that could be processed as a ZVP include outdoor cultivation with a canopy area of 5,000 square feet or less, distribution, manufacturing, testing laboratories, and retail (storefront and non-storefront). To qualify for this permitting pathway, these facilities must meet specific zoning criteria. While a ministerial pathway will be an option for certain facilities, a discretionary Site Plan and Administrative Permit will be needed for facilities that have certain zoning designators, such as those that require Design Review. Facilities that require an Administrative Permit include indoor cultivation, mixed-light cultivation (greenhouses), outdoor cultivation greater than 5,000 square feet, microbusinesses, consumption lounges, and all other facilities that do not meet the criteria for processing as a ZVP. The Director of PDS also has the authority to approve these projects.
Following the April 10, 2026, Planning Commission hearing, minor changes were made to the Zoning Ordinance to remove duplicative requirements for informational and educational events. Reference to these events and how they are regulated can be found in the amendments to the Code of Regulatory Ordinances. Additionally, revisions were made to clarify accessory uses for cultivation and manufacturing facilities, as well as to clarify the criteria for ZVPs. These edits are minor in nature to ensure that potential projects are within the scope and meet the intent of what could be approved with a ministerial permit. Minor changes were also made to definitions and to add references.
Final Program Environmental Impact Report
The SECP included the preparation of a PEIR, as required by CEQA (Attachment A). A PEIR is used to inform public agency decision makers and the public of the significant environmental effects of a project, identify ways to mitigate or avoid the significant effects, and describe a range of alternatives to the project that could attain most of the basic objectives of the project while substantially lessening or avoiding any of the environmental impacts. CEQA requires that a PEIR analyze project alternatives to allow evaluation, analysis, and comparison of impacts among alternatives with the Proposed Project (also referred as Alternative 2). These alternatives must avoid or lessen the Proposed Project’s environmental impacts while achieving most of the Proposed Project’s objectives.
Public comments were accepted on the Draft PEIR from January 30 to March 31, 2025, and the Final PEIR, including responses to public comments, was made available to the public in spring 2026, preceding formal recommendations or determinations on the SECP. The Final PEIR, responses to public comments, and the description of the five project alternatives and their significant and unavoidable environmental impacts are provided in Attachment A.
On January 14, 2026 (3), the Board provided preliminary guidance to mirror State law, which is consistent with PEIR Alternative 2, the Proposed Project, that allows all cannabis facility types and requires a 600-foot buffer from schools, day cares, and youth centers. The Final PEIR found that adoption of the SECP under consideration today (Alternative 2) could result in certain significant and unavoidable environmental impacts. These include impacts to aesthetics, air quality (odor), adequate water supplies, temporary construction-related noise, and transportation. Other than the PEIR Project Alternative 1: No Project - Retention of Current Cannabis Regulations, the only other alternative that would reduce impacts compared to the project under consideration today is PEIR Project Alternative 4, which would prohibit outdoor cultivation, reducing air quality impacts (odor) to less than significant. Most environmental impacts are anticipated to occur from cultivation activities. Mixed-light cultivation typically consumes significant electricity for growing. Odor is more difficult to control when cannabis is grown outdoors or within a greenhouse (mixed-light), which regularly vents to maintain an optimal growing environment. Since significant and unavoidable environmental impacts related to aesthetics, air quality (odor), adequate water supplies, temporary construction-related noise, and transportation were identified in the Final PEIR, today’s action includes the adoption of the CEQA Findings of Fact and SOC, which can be found in Attachment A.
The Final PEIR includes an MMRP (Attachment A) because the PEIR identified potentially significant adverse impacts. Mitigation measures have been identified to reduce most of those impacts to a less-than-significant-level. The purpose of the MMRP is to ensure that the mitigation measures identified in the Final PEIR are implemented and documented. The MMRP outlines each measure, its timing, and the party responsible for ensuring it is carried out. The mitigation measures are also referenced and incorporated into the draft Zoning Ordinance amendments to ensure that projects comply with them. The measures would be incorporated into future projects during the application review process. For example, certain mitigation measures would require reports such as a biological resources assessment or a groundwater report.
Code of Regulatory Ordinances Amendments for Cannabis Licensing
The SECP includes proposed updates to the County Code of Regulatory Ordinances (Attachments D and E). These proposed updates would create a new cannabis licensing system that would allow existing and new medicinal and/or adult-use cannabis facilities to obtain a County operating license for one of the following categories: retail (storefront and/or non-storefront), cultivation, manufacturing, distribution, testing, consumption lounges, and temporary cannabis events or a County operating license for a microbusiness license. The proposed updates to the Code of Regulatory Ordinances outline new licensing regulations that include requirements for license applications, facility operations, and enforcement parameters, along with associated fees. Also included are updated guidelines for renewals, transfers, suspensions, and revocations, as well as PDS oversight responsibilities for cannabis businesses.
The proposed amendments include updates to definitions, application submittal requirements, operating standards by facility type, license issuance and conditions, inspections and compliance monitoring, enforcement authority and penalty provisions, and administrative procedures for renewals, transfers, suspensions, and revocations. Additionally, a minor revision was made to clarify that informational and educational events are allowed consistent with State law.
The draft amendments also modernizes Chapter 25 of the Code of Regulatory Ordinances by transitioning from the legacy Operating Certificate framework to a broader Cannabis Business License structure, expanding the scope of regulated cannabis activity types consistent with State-authorized commercial activities (including temporary events and on-site consumption operations), including a renewal structure with related administrative timeframes, and revised compliance and enforcement provisions addressing inspections, violations, penalties, and license suspension or revocation, as applicable, for both licensed and unlicensed cannabis activity.
Consistent with Board direction, the proposed amendments revise the local Cannabis Business License process to rely on the State background check process and eliminate a local background check requirement, while retaining County authority to deny, suspend, or revoke a County operating license based on verified compliance, operational, or enforcement considerations, consistent with the Code of Regulatory Ordinances and license conditions.
Funding for Enforcement of Unlicensed Cannabis Activity
On June 15, 2022 (7), the Board directed to adopt a Board Policy at the time of SECP consideration that establishes minimum funding requirements for code and law enforcement to address unlicensed cannabis activities. In response to that direction, staff drafted the proposed Board Policy B-076: Minimum Funding for Unlicensed Cannabis Enforcement (Attachment I).
Over the past three fiscal years, unlicensed cannabis enforcement has averaged $150,000 annually within PDS budget for code enforcement and $1.6 million annually within the Sheriff’s Office budget. Current enforcement efforts are collaborative, with PDS addressing land use-related code compliance concerns, such as the lack of building permits and unpermitted land development, including the removal of native habitat and similar environmental concerns. The Sheriff’s Office Marijuana Enforcement Team addresses public safety concerns. Both PDS and the Sheriff’s Office refer specific concerns to other regulatory agencies as necessary, including the California Department of Cannabis Control, the California Department of Fish and Wildlife, and the Regional Water Quality Control Board. Collectively, these efforts address unpermitted land disturbance and illicit operations, providing environmental protection, public safety, and consumer safety.
The proposed Board Policy requires PDS and the Sheriff’s Office to consider illicit enforcement workload and trends in annual budget requests under the County’s General Management System to ensure adequate resources are available for future unlicensed cannabis enforcement efforts. Funding for compliance efforts at licensed facilities under the SECP is separate and included in the licensing fees described below.
Funding for Oversight of Licensed Cannabis Activity
Adoption of the program includes establishing permitting and licensing fees intended to support cost recovery for application processing, technical review, inspections, compliance monitoring, and enforcement. On June 14, 2022 (2), the Board adopted fees of $49,460 for the licensing of medical cannabis facilities by the Sheriff’s Office Licensing Division. On October 26, 2022 (2), the Board approved the transfer of the licensing program to PDS along with annual licensing renewal fees of $20,064. Annual renewal fees were reduced by roughly $30,000 through the transition of licensing to PDS.
Today’s staff recommendation for the proposed future licensing fee structure includes fees for initial applications, annual renewals, and other administrative actions (e.g., ownership changes, transfers, or operational modifications). Several new cannabis facility types and activities are proposed under the SECP and require the establishment of new licensing fees. Proposed fees for these new cannabis permit facility applications will vary by business type, ranging from $22,000 to $25,000, while annual license renewals will be reduced to the rate of $18,536. The proposed new facility licensing fees include a phased licensing approach to minimize the upfront financial burden for future cannabis businesses. During Phase 1, staff begins review of the proposed cannabis business type and location. During Phase 2, staff will review the specific requirements of the Code of Regulatory Ordinances for the proposed facility, including neighborhood compatibility plans, odor mitigation plans, and similar items. Fees during Phase 3 will cover ongoing operational inspections and related administrative tasks.
Land use permit fees have also been established to ensure sufficient staffing for the review of proposed cannabis facilities and compliance with applicable zoning and environmental regulations. A ZVP, which is ministerial in nature, requires a $5,391. deposit. Additional deposits may be needed for more complex ministerial projects. Total costs for ministerial land use permits will range from $12,500 to $14,500. The standard Administrative Fee is proposed for cannabis facilities that are discretionary in nature. The standard deposit of $7,500 will cover initial staff costs for review, scoping, and associated environmental review of discretionary permits. Total costs for discretionary land use permits are estimated at $10,000 to $45,000, varying by the complexity of the proposed cannabis business and associated environmental review.
Board Policy B-29 full cost recovery requirements apply to both the cannabis business license fees and land use permit fees. All proposed cannabis fees have been crafted to ensure sufficient resources are available to process new licensing applications and provide ongoing oversight. The permitting fee structure reflecting the cannabis ministerial and discretionary land use permits is included in the draft Fee Schedule (Attachments G and H).
Social Equity Ordinance
Amendments to the Code of Regulatory Ordinances also include social equity items to promote fair access for individuals adversely impacted by cannabis criminalization. As part of the SEP, social equity applicants would have a three-year head start to obtain a cannabis license, with 50% of storefront retail dispensaries reserved for social equity applicants (with a limit of 25 total storefront retail dispensaries in the unincorporated County). All social equity-owned businesses must retain at least 51% ownership by social equity applicants. Also, included in the proposed ordinance is the CECP, which is a voluntary opt-in program that businesses may participate in. The CECP is focused on Community Incentive Grants, which allow cannabis businesses that provide a community benefit such as improvement of parks, community art or murals, tree planting, microgrants, community gardens, historical placards/signs, and bike racks to apply for and receive rebates or grants based on being up to date on their cannabis taxes for at least one year.
Project Analysis
The Socially Equitable Cannabis Program (SECP) includes a Program Environmental Impact Report (PEIR) that analyzed a range of cannabis project alternatives and their environmental effects. The PEIR found that, even with safeguards in place, impacts related to odor, noise, and groundwater use could remain significant and unavoidable. The Final PEIR includes a Mitigation Monitoring and Reporting Program (MMRP), which identifies mitigation measures to reduce most of the environmental impacts identified in the PEIR to a less-than-significant-level. These mitigation measures are incorporated into the Zoning Ordinance amendments and the permit application review process. The Final PEIR and MMRP can be found in Attachment A. Furthermore, the Zoning Ordinance and Code of Regulatory Ordinances amendments, the Social Equity Ordinance, as well as the permitting and licensing fees, were developed based on extensive best practice research and stakeholder input.
Environmental Statement
On June 9, 2021 (2), the Board of Supervisors (Board) directed the development of a Program Environmental Impact Report (PEIR) to analyze the environmental effects of permitting and licensing new cannabis facilities in the unincorporated area. The PEIR, dated March 2026, has been prepared for the Socially Equitable Cannabis Program and is on file with Planning & Development Services. The PEIR found the project would result in significant and unavoidable impacts for the following environmental areas: aesthetics, air quality (odor), groundwater, adequate water supplies, temporary construction-related noise, and transportation.
The Mitigation Monitoring and Reporting Program identified mitigation measures to reduce most impacts to a less-than-significant-level. It outlines each measure, its timing, and the responsible party. These mitigation measures are incorporated into the draft Zoning Ordinance amendments and will be applied into future project application reviews to ensure compliance.
Public Input
To solicit feedback from diverse stakeholders on the components of the Socially Equitable Cannabis Program (SECP), staff conducted a multi-year, robust public engagement and outreach strategy. This valuable feedback helped to shape and refine the analysis, draft options, and final draft of the SECP. Since the Board of Supervisors (Board) directed the development of the SECP in 2021, Planning and Development Services (PDS) has conducted over 295 outreach meetings with the public, cannabis businesses, social equity advocates, Community Planning and Sponsor Groups (CPSGs), tribal governments, cannabis industry advocates, environmental groups, regulatory agencies, labor groups, and public health and safety advocates. Notices for public meetings, hearings, and project milestones were emailed at least two weeks in advance to over 7,000 individuals who are subscribed to learn more about the SECP and PDS projects. Project materials, presentations, and other resources were posted on the SECP’s engagement website to help individuals familiarize themselves with the SECP.
Public input on the SECP varied. Several CPSGs expressed concerns about potential impacts on wildlife, light pollution, air quality and odor impacts from outdoor cultivation, as well as buffer requirements between residential uses and cultivation facilities. Some CPSGs were in opposition to the SECP altogether and supported Program Environmental Impact Report (PEIR) Project Alternative 1: No Project - Retention of Current Cannabis Regulations. While not considered an impact under the California Environmental Quality Act (CEQA), some commenters raised concerns regarding potential public health effects and safety impacts to local communities.
Conversely, social equity applicants, the Farm Bureau, and industry advocates supported PEIR Project Alternative 2: Proposed Project - Cannabis Program Consistent with State Regulations, supporting regulatory alignment with State requirements to ensure the availability of suitable locations for a cannabis facility and safe access to cannabis.
Department Reasons for Recommendation
Today’s recommended actions have been evaluated by Planning & Development Services and the Office of Equity and Racial Justice. The reasons for the recommendations are based on the proposed Project’s consistency with County priorities, plans, and initiatives to support equity. The recommendations would advance the Board of Supervisors’ direction since January 2021 to establish a safe, equitable, and environmentally responsible cannabis industry in the unincorporated area, while promoting fair access for those who have been impacted by cannabis-related criminalization and the War on Drugs.
Linkage To The County Of San Diego Strategic Plan
Today’s actions support the County of San Diego’s 2026-2031 Strategic Plan by advancing efforts that promote justice and community. The draft Socially Equitable Cannabis Program includes a Social Equity Program which provides training, one-on-one mentorship, record expungement assistance, grant opportunities, and workforce development assistance for individuals who have been previously impacted by the War on Drugs. Community Incentive Grants will provide funding and other resources to uplift and improve the community.
Respectfully submitted,
Dahvia Lynch
Deputy Chief Administrative Officer
Attachment(s)
Note: Due to the size of the attachments, the documents are available online through the Clerk of the Board’s website at www.sandiegocounty.gov/content/sdc/cob/bosa.html <file:///\\ssvmw2pia507702\enterprise\LUEG\Board%20Letters\2026\08-19-26\PDS\SECP\STUL%20Board%20letter%20-%20for%20Attachment%20F\www.sandiegocounty.gov\content\sdc\cob\bosa.html>.
Attachment A - CEQA Findings, Statement of Overriding Considerations, Mitigation Monitoring and Reporting Program, and Final Program Environmental Impact Report
Exhibit A - Final PEIR: Notice of Preparation and Comments Received
Exhibit B - Final PEIR: Public Review Ordinances - Proposed Amendments to the San Diego County Zoning Ordinance and Code of Regulatory Ordinances for Cannabis Uses (October 2024 version)
Exhibit C - Final PEIR: Air Quality, Greenhouse Gas, and Energy Modeling
Exhibit D - Final PEIR: Noise Measurement Data and Modeling Calculations
Exhibit E - Final PEIR: Letter A6 Attachments - Proposed Amendments to the San Diego County Zoning Ordinance and Code of Regulatory Ordinances for Cannabis Uses and Mitigation and Monitoring Reporting Plan
Exhibit F - Final PEIR: Letter I34 Attachment - Los Angeles Times Article
Exhibit G - Final PEIR: Letter PM 104 Attachment - Los Angeles Times Article
Attachment B - An Ordinance Amending the County of San Diego Zoning Ordinance Related to Commercial Cannabis Regulations (POD-21-001)
Attachment C - An Ordinance Amending the County of San Diego Zoning Ordinance Related to Commercial Cannabis Regulations (POD-21-001) (Changes Shown)
Attachment D - An Ordinance Amending the County of San Diego Code of Regulatory Ordinances Related to Commercial Cannabis Licensing and Operating Permits (POD-21-001)
Attachment E - An Ordinance Amending the County of San Diego Code of Regulatory Ordinances Related to Commercial Cannabis Licensing and Operating Permits (POD-21-001) (Changes Shown)
Attachment F - An Ordinance to Add Chapter 29 to Division 1 Business Regulations, of Title 2 Licenses, Business Regulations and Business Taxes to Amending the County of San Diego Code of Regulatory Ordinances Relating Related to the Cannabis Social Equity Program
Attachment G - An Ordinance Amending Article XX, Section 362.1 of the San Diego County Code of Administrative Ordinances Relating to Department of Planning & Development Services Fee Schedule (POD-21-001)
Attachment H - An Ordinance Amending Article XX, Section 362.1 of the San Diego County Code of Administrative Ordinances Relating to Department of Planning & Development Services Fee Schedule (POD-21-001) (Changes Shown)
Attachment I - Board Policy B-076: Minimum Funding Requirement for Unlicensed Cannabis Enforcement
Attachment J - Socially Equitable Cannabis Program Action Sheet
Attachment K - Public Communication