Dozens of marijuana businesses could open in Stanislaus County, but not by Jan. 1

Stanislaus County officials got what they expected when a three-week window was opened last month for initial applications from marijuana businesses.

Almost 120 signed up with the county between Oct. 2 and Oct. 20, checking multiple boxes to express interest in seeking a total of 464 cannabis permits, said Keith Boggs, assistant executive officer for the county.

There was initial interest in 57 permits for storefront retail outlets, Boggs said, though the county says it won’t allow anywhere near that number.

Other applicants want to operate indoor cultivation, nurseries, greenhouses, distribution, manufacturing facilities and testing labs.

Boggs said he was not surprised by the number of registrations, which required applicants to plunk down a $4,359 nonrefundable deposit. “I thought it might be even more,” Boggs said. “This industry is clamoring for validation.”

Some of those registrants will be disappointed. The county has set a limit of 61 cannabis permits in unincorporated areas and will permit no more than seven retail dispensaries.

None of the permits will be issued by the Jan. 1 date when retail sales of recreational pot will be legal in California due to passage of Proposition 64.

Stanislaus County expects to set a Feb. 9 date for entrepreneurs to complete their cannabis permit applications. Staff members will screen, vet and review the applications before recommending the top ones to the Board of Supervisors.

The county Planning Commission will consider an ordinance amendment this month on zoning regulations for marijuana businesses. The county proposes to allow them in its general agricultural zone, planned industrial areas and commercial zones. The businesses won’t be permitted in residential neighborhoods and commercial areas near highways.

Boggs said the county will cooperate with Modesto and other cities if marijuana businesses are proposed near municipal boundaries.

The county plans to collect fees from cannabis operations under development agreements. When county leaders approved the strategy in September, the proposed fees were 8 percent of gross sales, 2.5 percent for testing labs and $5-$10 per-square-foot for indoor cultivation.

Officials believe the fees could generate an annual $4 million to $7 million for the county. Officials have said the county will need the money to take action against illegal operators and deal with the social ills of marijuana use.

Modesto will have the authority to tax marijuana businesses with overwhelming approval of Measure T in Tuesday’s election, but city leaders have not decided what commercial activities to allow. The Modesto City Council will hold a 1 p.m. workshop Monday to talk about regulation of cannabis activities.

Ceres approved a development agreement last month for a 6,000-square-foot medical cannabis dispensary. Oakdale has accepted proposals for marijuana businesses and the Riverbank council passed an ordinance in August to allow an unlimited number of marijuana dispensaries.

Other cities in the county, however, have no plans to allow retail licenses.

Most cities and counties in the state are wrestling with local regulation of recreational pot. The more upscale cities in the Sacramento area -- Roseville and Elk Grove -- will prohibit retail sales. The California Bureau of Cannabis Control recently told the Associated Press it expects to issue only temporary licenses in January.

In Calaveras County, the new leaders on the Board of Supervisors could reverse course and discourage marijuana grows.

Stanislaus County’s conservative supervisors have inveighed against non-permitted cannabis activities and promised to shut them down after the legal ones are permitted next year. The board approved the permitting strategy on a 4-1 vote in September. Supervisor Dick Monteith, who cast the dissenting vote, wanted to see the county ban commercial marijuana.

“We are just trying to get our arms around this industry,” Boggs said last week. “We are trying to be fair and diligent.”

This story was originally published November 9, 2017 at 5:10 PM with the headline "Dozens of marijuana businesses could open in Stanislaus County, but not by Jan. 1."