llow this tree to be cut down, no tree is safe in the city of Santa Cruz. You have on one side the written testimony of your own city arborist and a well-respected arborist, James Allen, who say the tree is healthy, that it is not a danger and that measures can be taken to prevent damage to the foundation. You have on the other side a well-meaning and fearful homeowner who is afraid, but has no substantive scientific information that says the tree is a danger. Additionally, cutting this tree does not meet the requirements of the city's own tree ordinance, and I urge you to follow your own tree ordinance and to respect the learned opinions of the arborists who have said that this tree is not a danger. If it becomes a danger in the future, the homeowner can reapply and ask that something be done. But at the present time, there is no danger that has been documented. Please, save this tree. Thank you. Thank you. Next speaker, please. Good afternoon, Eduardo D'Aliu, the owner of the house in 1420. So as you know, the giant sequoia is only in its infancy stage and it will continue to grow by nature into our neighbor's property. And we all know that the tree will eventually has to be removed. So why continue to create a financial hardships for my family? The cost analysis in front of you is based on all the estimates that we received to remove the tree and the repairing the current damages today versus completing doing the repairs now, installing the recommended root barrier and that it's only gonna last 10 to 15 years, removing a much bigger tree later on because the tree continues to grow and completing the additional repairs that are gonna need at that point. So due to this tree, our family has already spent over $6,000 and now we're looking at additional $32,000 of expenses. We're in this up to about $37,000 plus. On the other hand, if we proceed with the recommendation of the root barrier, perform the new repairs today and having to remove the tree, the much bigger tree and 10 to 15 years from now, the estimate cost raised to about $75,000. So which is about $27,000 more of what is gonna cost us today and it's gonna double the cost and it's basically a temporary solution, right? In the city here, this tree grant program only covers 50% of the repair costs, up to $5,000, okay? So that's only 15% of the $32,000 we have to spend now. On August 30th, I spoke on the phone with the experienced bio barrier sales rep and explained our tree situation and location, inquiring more information about the product and he said, using the bio barrier for growing giant sequoia is a crap shot. Rolling the dice, your efforts are better to spend to save money now and have the tree removed. This barrier will not stop the tree from growing. In addition, the root barrier main ingredient is called trifluoroblin and it's known to have carcinogens and it's completely banning Europe. So thank you. But thank you. Next speaker, please. Good afternoon, Victoria Sanchez-Toledo. Our approved tree permit should be upheld under the criteria of the tree resolution, which is not meant to be absolutist and states the heritage tree has or is likely to have an adverse effect upon structural integrity of a building, utility, or public or private right of way. One, the tree has had an adverse effect on the house's foundation and our patio as invoices attest. Two, the tree is inappropriately placed on our small urban lot, close to homes and continues to likely have an adverse effect on our foundations and replacement patio. Three, the tree has had an adverse effect on our cracked and lifted sidewalk causing public hazard. Four, the tree continues to likely have an adverse effect on our sidewalk. Five, the tree continues to likely have an adverse effect on the main sewer system, a major point of city infrastructure that may have or will cost thousands of dollars of damage that the city is and will be responsible for. Without doubt, these reasons alone uphold the tree removal permit. Additionally, one, as our realtor confirmed to council member Cron, the extent of problems the tree caused and will continue to cause were not discoverable or disclosed by the seller at that time. This misplaced tree has been a burden for many owners. Why continue the burden for our family and our family's future generations? Two, the tree is impeding our rightful use and enjoyment of our front yard. Three, the tree is and will only worsen economic hardship for the owner and neighbor with postponing removal, increasing costs by 40K when kids are in college. Four, this tree is a community danger. Five, the giant sequoia is not on the city's approved list of trees for a reason. The park and rec commission voted six to one and stated anything less than granting a tree permit is simply kicking the can down the road. Respectfully, we implore city council not to kick the can down the road. Thank you. Next speaker, please. Hold on for a second. It just blinked out. Hi, I'm Chris Parse, the neighbor. I'd like to say I'm saddened by the polarization. I feel this has caused in our neighborhood. I lived in my home for 19 years. I've raised my family here because I love nature and this community. I have a huge oak tree in my backyard, which I love. However, I think perspective is important here. The houses were here first. Mine was built in 1917, but this improperly positioned in non-native tree is encroaching on and damaging my property. Current damage repairs are at about $20,000. The tree itself is inches from the property line and once it crosses, Leslie has said I will become part owner of the tree. I cannot take on the financial burden of that. My daughter just started college. Over the years, I've complained to Leslie repeatedly that the former neighbor was not taking care of the tree. She was hiring day laborers with power tools to secretly remove roots and discuss the tree's list towards my home. The proposal to cut even more of the roots around this gigantic tree, which is tilting towards my home, as you can see, really sounds unsafe to me. A decision to deny the permit is a decision to kick the can down the road. The tree is still growing and according to the arborist is still in its infancy. Future costs to my family, the Toledo family and the city of Santa Cruz will only increase. It is sad that the tree is in the wrong place. I hear that and I believe that. However, 50 years ago, someone chose to toss their old Christmas tree into the ground next to the corner, next to my house, next to the Toledo home without thinking about the future. And I'm asking you to save us from the recurring costs of maintaining an inappropriately placed tree. The safety and welfare of families must be maintained and considered. I can't imagine that this is in the spirit of the Heritage Tree Program. And again, in this case, the houses were here first. Please let's plant an appropriate tree that all the neighborhood can enjoy. Thank you. Next speaker, please. Good afternoon, Council Members. My name is Ed Porter. I've seen issues like this before. And I just want to say that our community, our city is proud of our community process, is proud of the way we assemble here to talk about these things, is proud of things happening like 700 and some people signing a petition to be submitted to the Council to consider this very carefully. So we're proud of our trees in the city too, or we wouldn't have a Heritage Tree Ordinance at all. And in my opinion, if ever there was a tree that should be considered to be a Heritage Tree in our city, it's this one. It's one of the most magnificent trees in the city of Sacros. So I just asked the Council to vote to keep this tree. And also an idea that's been floated around many times, but I haven't seen much implementation of it, is that the City of Santa Cruz has a fund in the park's budget to assist in things like root barriers and of management of Heritage Trees so that the city could financially share a little bit in the cost of maintaining Heritage Tree if the city believes that this is a Heritage Tree. So I urge you to vote to save this tree. Thank you. Are there any other members of the public that wish to speak to this item? This is item number 11. It's a Tree Permit Appeal for 1420 King Street. If you could close out the slides, I don't know if someone's got theirs there. Okay, is there any member of the public that wishes to speak to this item? Okay, seeing none, I'll bring it back to the Council for deliberation questions and answers. I know you guys spent time on it last time. I have a quick question that came to mind on this. Is there any required disclosure when someone is purchasing a home that they have a Heritage Tree on there or that they should be aware of the impacts? And I don't know if that's a park's question or if it's a city attorney question. Let's take a question. No, mom, it's in, yeah, right. Transfer disclosure statement is a required statement by the California Civil Code that specifies different types of disclosures that need to be made. For instance, if there's a code violation on the property or if there's any known hazardous materials on the property that could pose a health and safety threat, those sorts of things. To my knowledge, the fact that a tree is designated as a Heritage Tree on a city's Heritage Tree ordinance is not one of those disclosure categories. I haven't reviewed that issue carefully, but I'm not aware of that being a requirement. Okay, thank you. So is Council Member Crum? I have a couple of questions for Leslie. Something about the root barrier doesn't work is what one of the people at the podium said. Does root barrier work? In my experience, we have installed root barriers in different circumstances and also private property owners have installed root barrier panels and had success. And what about the tilt that's being referred to? I think I asked you this question last time, but have there been many giant sequoias that have toppled over recently in the county or even in the outside the county? In my opinion, there's no stability issue or likelihood of failure due to the list of the upper canopy. And how realistic is it for the city to share expenses with the applicant on preserving this tree? And what would those expenses be over the next five years, say? Well, it's difficult to project the expenses exactly on this depending on what the applicant and the neighbor opt to do, but the city did voluntarily approve a heritage tree grant program and pending this determination, I've set aside the maximum allowable amount of $5,000 to assist the property owner with any repairs that they'd like to come forward and work with me on. What does the root barrier generally cost? I think in this situation, it would depend on if the root barrier panel would extend onto the neighbor's property, but it would probably be a panel that might be $3,000 to $4,000 would be my guess. Thank you. I mean, I joined Mr. Porter, former council member Ed Porter in his remarks about this being a truly remarkable tree and it is one of the main heritage trees in our community right now. I mean, when I lived in San Diego, Santa Cruz was known for trees and people talked about the trees and I just think that we should take that in consideration that here is one of them and what Mr. Stover said about a carbon sink and trees being places where carbon is stored and everybody's worried about global warming. Here's a perfect chance for this council to like make a statement and do something about global warming as well and preserve this tree. Well, I know that I had the opportunity to watch the deliberations and you spent a lot of time talking about it. I actually had one impression at watching the video then going out to looking at the site. I had a different one in terms of the impacts in the surrounding areas. I totally understand the issue about the heritage tree and what we want to do to protect it, but in this case, I do feel that I and more after reviewing it and going on site feel that the Parks and Recreation Commission's review gave a little bit more perspective that I didn't have before in regards to the tree. I do want to ask the council how they feel about making sure there's clarity on when someone purchases a home that they have some sort of notice that they have a heritage tree on their property. So it's not just something that's left open. When you go to that site and you look at the root structure that's going under the foundation and the former site, I mean, that wasn't apparent, I imagine, unless you pulled out and dug in there and looked at it yourself. So I guess I'd like to just say that that's something I feel like I'm interested in having some sort of notice requirement whenever there's a transfer of real estate that if there's a heritage tree on it, it's gotta be clear that you know what you're buying and what the impacts are. That's just something that I came away from that. I will go ahead because unless others have questions or comments. As I mentioned last time, I agonized over this a great deal and I did go over the ordinance, all the documentation, all the letters and comments that were submitted and did visit the site as well. And given all that, I will maintain the position I took last time denying the appeal and upholding the Parks and Rec decision. I wanna make just a few comments for the record. It's true, the buyers knew that there was a big tree there. I think it's also true, they did not realize how much damage was being done to the foundation. They were unaware of the work that had been done on the roots and then covered up. So there was a great deal that was not disclosed. Much can be known or unknown about what might happen in the future here. But to my mind, the tilt and the kind of extensive root damage and at least some damage to the foundation itself are all legitimate concerns that are consistent with the ordinance. I will say parenthetically, in my mind, damage to a sidewalk can be readily remedied. That in and of itself is not the reason to take down a heritage tree. And similarly, damage to clay sewer lines, that's just gonna happen. If you have an old house, it's gonna happen. So I speak from experience. So fixing that will undoubtedly have to happen, regardless for both of the properties. In fact, we recently passed a sewer inspection and maintenance ordinance because that problem exists all over the city. So I wanted to kind of separate what seemed to me like legitimate concerns and issues and not. I also noticed that that property has a lot of trees on it already. I didn't inspect it, but there's, I think, three street trees, locust trees, there's a strawberry tree, I don't know, a loquat tree, some citrus, a couple of palms, a couple of birches, a Japanese maple, all in that parcel. So I mean, to the extent that the conditions are replacement of trees on that site, if that is the condition, I would say no, put the trees somewhere else and look to the owners, look carefully at the trees you've got and figure out the ones you wanna keep because relative to your point, there are heritage trees and there are heritage trees and some of them are great in an urban environment and some of them are murder. And so, not all heritage trees are created the same. It's a good point, but anyway, that's a very significant tree. It's on the scale of trees, kind of recent, apparently, and it's hard to make that decision, but I think in this case, it's the right one. And I just would say let's focus on making sure that the other trees on this property are maintained and healthy and maybe selected a bit so that they can thrive and that the replacement trees are chosen and placed in areas where they too can be a real addition. So I will go ahead and make that motion. That is to deny the appeal. Is there a second? Nope. Okay, seconded by Vice Mayor Watkins, motion by Council Member Matthews. Is there any further discussion? Council Member Cronin. Well, I'm disappointed the way the decision's going. I'm really disappointed in Council Member Matthews because I believe you're on the council and the trees in front of the dentists office, Bill Christie, the Monterey, excuse me, the Canary Island Pines. And you relied on our staff to do what they do and give us the best advice they gave us. They said at that time those trees should probably not be preserved. And you went along with that, you relied on staff, this time staff saying, no, this is a good, this is a healthy tree. This tree's gonna be around for a long time. And now you're throwing that into the wind and saying, no, let's cut this tree down. So I don't know, you want it both ways. It's very disturbing. I just think we're going the wrong way on this one. I think the tree is healthy and I think we should be preserving it. Okay, there's a motion on the floor. All those in favor, please say aye. Aye. Those opposed? Okay, that motion passes with Council Member Crohn opposed and Council Member Brown absent. Next slide, Maul and the agenda is the Cannabis Ordinance Amendments and Update. What I'd like to do is ask for just a five minute break before we get into that. So everybody wants to take a break and then we can go come back. $4,000 every time. I know. Well, and there was a fee. If it comes up about. That's 424 p.m. Next up on our item is item number 12, the Public Hearing for Cannabis Ordinance Amendments and Updates. Yes, we did write that letter. We have a presentation from staff in regards to this item and I'd like to turn it over to you. Good afternoon, Council Members. My name is Sarah Fleming and I'm Principal Planner with the Advanced Planning Division of the City's Planning Department and I'm here with Catherine Donovan, our Senior Planner and our Cannabis Project PM, our Project Guru. And we'll be presenting to you today some Cannabis Ordinance Amendments and other informational items. I'll turn it over to Catherine. Good afternoon. Happy to be here. Glad to see you. We're bringing, as you saw in the staff report, a number of different items. But the first are the Cannabis Ordinance Amendments that we are proposing. The first is for advertising and signage, then a proposed business tax rate revision. Then we'll cover the program status to date and then bring you our proposed legalization program. Topic one, advertising and signage. We're proposing, at our original adoption of the ordinance, the Council had asked us to work with community prevention partners on some of their proposals to prevent youth from starting to use cannabis. And we met with them several times and basically discovered that we really met their goals, except in one area and that is in our advertising. And so we have taken the language that they requested and put it into our ordinance and it would prohibit pricing, photos or graphics of the cannabis plant and any images of specific products from being used in advertising except on a dedicated website that has an age portal. And it would also be allowed with wholesale advertising because it's not intended to stop business to business advertising. The proposal for the signage, this was a request that came from the industry, our original signage restrictions came when the medical marijuana ordinance was first adopted and the city was very cautious at that time and we had significant restrictions on the size of signage for cannabis businesses. The industry has suggested that at this time those are somewhat outdated restrictions and has requested that they be given parity with other business types, given that there are no other business types in the city that have restrictions based on the business usage that seemed to be a reasonable request for us and so we are proposing that in our ordinance amendments. And the current sign ordinance under that restriction would allow two signs and there is a formula based on the frontage of the building that dictates the size that's allowed for those signs. The other ordinance we're proposing is related to our cannabis business tax rates. There are multiple different types of cannabis businesses, cultivation, manufacturing, testing, distribution and retail. At the time that the initiative that approved the taxes was approved, recreational marijuana was not legal and so we only had one type of business which was our medical dispensaries. The council at that time voted to set the tax rates at 7% and then an additional percent was added for the children's fund with the adoption of the recreational marijuana ordinance. So currently all of our businesses are taxed at an 8% rate but not all businesses have the same overhead, the same markup, the same impact on the product. And so at this time, we are recommending that testing labs which basically just perform a service for the industry that they provide the industry with the required, state-required testing certificates that the taxes for that service be lowered to 1% and that for distribution businesses which are basically wholesale businesses that provide a service to the industry by giving cultivators and manufacturers broader distribution and giving retailers a place where they can shop from many different products and they typically have a relatively low markup between 15 and 25% and so if you're taxing them 8% that's a very large percentage of their markup and so they either have to increase their markup or eat the tax cost which has a significant burden on the business. So we're recommending that that tax rate be lowered to 2% now given that we passed an additional 1% to be going to the Children's Fund. It makes sense to consider looking at how that additional funding for the Children's Fund is calculated. We did not make any changes in the ordinance at this time but we've been talking with the finance department and other interested people and the proposal that makes sense to us which we'd like you to just consider at this time because we're not proposing it is that rather than having that 1% set aside that it be a percentage of the total tax funding that comes in and to set it at an equivalent of the 1% of 8 which would be 1 eighth or 12.5%. So that's just one proposal but it seems like an equivalent proposal that would make sense. The other things to consider when we're looking at the cannabis business tax are taking the big picture and considering what we want with our cannabis industry overall. Right now with sort of a competitive market throughout the state we need to think about are we competing with other local jurisdictions? Are we competing statewide? Do we wanna encourage this? Do we wanna set the price that will encourage businesses to come here and then potentially raise it later which seems to be a trend. So there's a bigger picture that we would like to look at and when we had originally brought the ordinance to the council there were a lot of questions about what the rate should be, what other cities were doing and it appears to be quite a moving target. Many, many other jurisdictions have been lowering their tax rates and so we didn't, we considered taking this wholesale to you and bringing a complete revision of our tax rate but we also thought that it might make sense to hire a consultant who could give us a broader view of this and so at this time we haven't made the wholesale all sector recommendations and we're asking you whether you would like us to put out an RFP for a contract for a consultant to look into this specifically for Santa Cruz. When we brought the ordinance to you almost a year ago now there were a lot of questions and not a lot of answers. There are still a lot of questions but we have some answers now. As you may recall, our retailer license was a competitive process and for that process, we actually, this slide is incorrect, I counted wrong, it should be, we had 15 cannabis retailer licenses not including our two existing businesses of those applications, nine included women as owners or partners and three included minorities as owners and partners and some of those were both women and minorities so. And then three of those were chosen over a number of factors that included whether they were local, the types of benefits they were providing to their employees, the types of benefits they were offering to the community, there were about 15 different factors that we looked at. We now have one new retail business that is open. The two other new retail businesses are still working on either obtaining a site or completing the improvements needed for their site and you may have noticed that in the staff report, I listed one of them as having found a site and listed the address and you got a letter yesterday that had a different address. And it's been like that, it's been a moving target but I think that retail license holder has found just the right property and is moving forward. The other applications that we've gotten to the other types of businesses, we've had 10 in total, two for cultivation, one for distribution, three for manufacturing, three testing labs and four that are a combination either cultivation, distribution and manufacturing or distribution and manufacturing and there's two of each of those. And I'm not positive, I think nine of the 10 have been approved, it might be eight of the 10 and one or two are still pending. The topic four is our business legalization program and this program was started when someone approached the department and said, I have an existing business and I'm interested in getting it legalized and how would that work? And so our code enforcement department put together a program and it's kind of a carrot and a stick. We want existing businesses to be legalized and we wanna help them do that and if they choose not to, we don't want them competing with our legalized businesses and so we're looking at ways to prevent that. The first question that comes up is whether the business can be legalized and that has to do with the type of business and the location, whether the zoning in that location would be allowed. If it's a retail business, we already have our five retailers so it couldn't be approved. The next question is whether there are any life safety issues? If there are life safety issues, then the business needs to be closed immediately. If there are not and it can be approved, it has the potential to be approved then the program is that we would work with the owners of the businesses to help them obtain their permits and to walk them through the process of completing and meeting their conditions. One of those conditions, and I bring this up because it was something that was asked about by the council, is that they would have to pay back taxes or enter into an agreement to repay the city any cannabis taxes that were due. Our cannabis ordinance went into effect basically the beginning of 2015 so if they were operating at that time, anything that they owed from that time forward they would have to repay to the city. So I've known in the past when we have these complicated staff reports it helps you if we go through the recommendations. So we are introducing for publication an ordinance amending section 2412-1340 of part 14 of chapter 2412 of the Santa Cruz Municipal Code adding restrictions to advertising related to cannabis and removing restrictions to signage for cannabis businesses. We are also introducing for publication an ordinance amending chapter 5.07 cannabis business tax to reduce tax rates for distribution and testing laboratories and to exempt non-cannabis containing items from the cannabis business tax. And I beg your pardon, I did not bring this up in my presentation but in our existing cannabis tax retailers are taxed on their gross and so non-cannabis items such as t-shirts and mugs and whatever else they might be selling also are subject to the cannabis tax and what we are proposing is that those non-cannabis items be subject only to our sales tax and not to the cannabis business tax. So the third item in this staff report is for council to consider and provide direction on hiring a consultant to review the city's cannabis business tax rates for other sectors of the cannabis ordinance. And number four is to provide feedback regarding the proposed cannabis legalization program. Any questions? Great, thank you for that report. Now, I appreciate you bringing back that the item we gave direction on in regards to the repayment of taxes for those. I think the discussion also at the time was when there was applications. Was there any assessment of those people that applied whether or not there was any sort of back taxes that were owed? We don't actually have any applications yet. We have, I think there's been discussion with that one person who came forward, but they haven't actually submitted an application yet. No, but I mean for those that are applying for licenses. Right? When you initially make an application for a license to do an assessment, if there's any back taxes owed. Oh, I see. None, according to the finance department, when we got those applications in the original retail applications, we ran them by the finance department. According to them, they did not owe back taxes. So we're okay on that. One more item, the clerk handed out to you a revised ordinance. Council Member Matthews stopped by my office before the meeting and she brought up that the wording in this second sentence here was a little confusing because it said any form of advertising or signage would be prohibited, whereas later we say it does not apply to signage. And so we clarified that to say or related signage such as window signs and temporary signs. And at the time that we were correcting this, we also discovered a spelling error, which is why the word devices is highlighted. You could have just corrected that and no one would have known that you're- Sure. We try to keep it transparent. Yes, thank you. So I guess one of the things I'd like to see, first of all, if there's any questions before we open it up for public comment. Council Member Cronin. Yeah, you said you might have some numbers for us at the meeting about how much we've collected so far. Yes. In the cannabis tax and also how much Children's Fund has collected. I have both of those numbers. So, so far from the beginning of our collecting of the cannabis tax, we have $1,733,201.77. We need to be more exact. And the amount in the Children's Fund is $61,010. And that since 2014, December, was it? I think it actually went into effect January of 2015. Thank you. The Children's Fund since this year. Yeah, the Children's Fund is since it was put into place last year. So it basically was from January up forward. That's all. Okay, what I'd like to do is maybe open it up for public comment first. And I know I did receive one advanced request for a group presentation from the kind people's collective. That was the only one I received.  Now is your time. Is there any other member of the public that wishes to speak to this item? If you would, please line up to my left and then you'll be going afterwards. Good afternoon. Feel like first just giving you guys so much gratitude and thanks for everything that you do. I've been here since two and this isn't my job and I can't imagine how much you guys have on your plate. So thank you. That's what kind people do. So I'm Khalil Mutawakil, Santa Cruz native father of two and CEO for kind peoples. Kind peoples provides roughly 100 living wage jobs and health benefits to each of our employees. We have consistently among other retailers as well done the following, provided safe access to cannabis to tens of thousands of community members. We have not had a single service call from PD since our inception. We've worked diligently with local leadership to develop sensible regulations. Consistently remitted hundreds of thousands of dollars a year in taxes. So my first concern is that retailers must have the ability to transfer their license. Currently the city ordinance prohibits us from taking on a partner for greater than 10% of our business and that's just not workable. I fear that day that I can no longer be the proprietor. I would be forced to fold my company and be liable for my lease and perhaps declare bankruptcy. License transfers are allowed by the Santa Cruz County ordinance where many successful transfers have already taken place without issue. We deserve the ability to create value like any other business. The county makes license transfers subject to an application process with background checks, et cetera. Moving on, my second item is taxation. Since the first of the year, there's a new 15% excise tax, approximately $150 per pound state cultivation tax, hundreds of thousands in state license fees and a barrage of new costly regulations that have significantly increased retail prices to the consumer. They are devastating small businesses. Greater than 90% of cannabis businesses across the state have already shut their doors. There is a growing opportunity for value conscious consumers to shy away from legal retailers and return or stay in the illicit market. The legalized states of Colorado, Washington and Oregon, each continue to have a thriving black market and have all taken measures to reduce their taxes. Colorado lowered their taxes after a state sponsored study substantiated claims that the state's 30% tax rate was permitting the continued existence of black market suppliers. We're actually much higher than this and locally we have the highest density per capita of retailers anywhere in the state of California. The market is spread thin with seven additional outlets coming online between Santa Cruz, Watsonville and Capitola. As we reach this critical point, let's not turn on our backs, let's not turn our backs on strong local businesses who have paid millions of dollars in taxes over the years and have the potential to contribute years of consistent tax revenue. Let's cast a large consumer net and encourage participation in a brand new marketplace. We want a well-regulated industry, but at a reasonable cost. The success of legalization is entirely contingent on the cost to the consumer relative to the illicit market. California has the most entrenched, robust and prolific illicit market in the world. Berkeley, Stockton and Oakland are at 5% for retail. Monterey County just reduced their rate to 4%, same as Sacramento. Santa Rosa at 3% and Sonoma at 2%. After alcohol prohibition, legal distilleries paid no taxes so they could produce alcohol cheaper than the bootleggers. Let's also put street dealers out of cannabis out of business to increase access to the youth, continue to encourage other business activities in the supply chain to also become legal, all while increasing the taxes going into the general fund. We don't need to waste tax dollars on a third-party consultant. To quote HDL company, the consultant likely to be awarded such a contract. Quote, evidence suggests the initial rates of 30% or more did not reduce the illicit market sufficiently and is advisable that if one intention of tax policy is to limit and eventually eliminate the illicit market and lower tax rates, particularly in the beginning of market legalization may be advisable. HDL also notes that while the tax revenue potential is attractive to local governments, imposing excessively high rates may reduce the number of businesses that step forward and decrease the likelihood that they will succeed in the regulated market. In conclusion, my recommendation is to tax retailers at 3%, cultivators and manufacturers at 2% and have no tax at all for distributors or testing laboratories. They are ancillary businesses that should not be taxed whatsoever. I appreciate your efforts. I want to thank this council and I appreciate the opportunity to speak today. Thank you. Next speaker please. Hello, my name's Nicole Lagner and I'm an attorney with a law firm called Clark Newbert and we counsel cannabis businesses across the state of California, as well as serve on several committees with state lawmakers and we've also been involved with some local lawmaking in Santa Barbara and the city of LA. I wanted to lend my support to the staff recommendation to lower the tax rate on distributors as well as testing labs. Distributors in particular, they serve a very specific service function to all other businesses. So they arrange for the state mandated testing. They're the only ones who can transport and they are also required to collect taxes both from suppliers and from retailers. Without a local distributor, you're going to disadvantage all of the local businesses here. Right now there are a couple of distributors in the city and the largest one is considering moving because the tax rate is just impossible. They're effectively taxed at 45%. Secondly, I also wanted to comment about the proprietary aspect that Cleal mentioned. So the threshold for ownership in the city of Santa Cruz is 10% in the state it's 20%. But this on the state and in every other jurisdiction does not mean that you cannot add an owner. It just means that you have to have a process to do that. So you all know who the owners are and like the county, you submit a form or you provide notice to the jurisdiction as well as to the state with your application that there is someone who qualifies as a new owner. This is someone with over that threshold percent equity ownership or has management direction and control over the entity. Without that, it's a draconian concept to say that you can't give your employees equity that you can't take on partners or any other business function. Thank you. Next speaker, please. Hello, my name is Dr. Christina Vorbey. I am an executive committee member on the coalition, the community prevention partners or CPP. I'm a community member here in Santa Cruz County. I'm also a national state and local champion for youth safety, youth mental health and youth substance use prevention. I want to extend a big thank you to you, the city council for directing the planning staff to work with CPP on advertising restriction language, opening up an ongoing dialogue about public health and youth cannabis prevention policies. Thank you for your leadership in this. We have learned that through the experiences with alcohol and tobacco industries that restricting advertising is an important prevention strategy and that's what I wanted to talk to you about today. Right now we have a unique opportunity to get in early on and apply lessons from the alcohol and tobacco industries to prevent youth cannabis use and its related harms through normalization, decreased perceptions of harm and earlier youth use of cannabis. So just real quick, I wanted to review the learnings from the research, years worth of tobacco and alcohol studies. So this is where I would cue the video montage but really I'm just gonna make two quick points about it. Tobacco research has identified that youth are three times more likely to be influenced by tobacco ads than adult counterparts. Advertising is more powerful than peer pressure or even family smoking rates in determining youth use of tobacco. The next industry research that I wanted to cite is alcohol research. There is consistent evidence across studies demonstrating the positive relationship between alcohol advertising exposure and underage drinking. So now on to our emerging research with regard to cannabis. Recent studies specific to cannabis have reported that the percentage of youth who saw cannabis advertising increased sharply from 25% to 70%. Thank you. Next speaker please. I am Nate Alex, dot kennedy at gmail.com 3469888. Now the big point I wanna make here is that what we really need to focus on is the use of the lifting of cannabis prohibition or marijuana prohibition to allowing for industrial cannabis hemp growth and use and it is a plant that has so many uses that it could be turned into quite literally millions of different things. We could build anything, paper and clothes are obvious but Henry Ford made a car out of hemp. We could make houses out of it. We could make skyscrapers out of it. We could make a lot of the parts that go into computers out of hemp. We could even make skyscrapers and spaceships from hemp. That is how diverse the use is. My suggestion is that we have the city of Santa Cruz start growing industrial hemp. We should have the city growing like at least a hundred thousand plants of industrial hemp not pot, not marijuana, industrial hemp. And thus bring back the industrial hemp industry and revolution that was going on up until near the beginning of the 20th century where suddenly with all this propaganda we suddenly get the human race to try and take this wonderful plant and drive it into extinction. We as a city need to do everything in our power to change that. As far as places that it could be grown you could grow it on rooftops. It doesn't necessarily even need to be a yard. We could allow it to be grown anywhere and everywhere. The only thing is permits and taxes and all that and even the taxes we should be taking part of the hemp as taxes. Thank you. Thank you. Next speaker please. Hi, my name is Jacob Lagner. I'm the CEO for Oz Distribution. I'd like to start off by saying thank you to the city council for an amazing job implementing the cannabis regulations in the city. Just really briefly about us. We are a type 11 distributor of commercial cannabis. We received our permit to operate in the city in March in the six months since we've really began operating. We've grown to more than 40 employees. The majority of whom reside in Santa Cruz. As a distributor we have the unique ability to assist local cannabis cultivators and manufacturers to enter the commercial supply chain. We distributed in the entire state of California from Mount Shasta to San Diego. There are few large distributors currently operating in the state without local distributors such as us. The local businesses have a disadvantage in entering the commercial supply chain. So I'm here today to ask the city to eliminate the CBD tax on distributors. Similar to a testing lab, we are an ancillary business. We serve three primary functions which were intended by the state which is to collect taxes on both the cultivation side and the retail side. We function as compliance. So we are the gatekeepers for entering commercial product into the supply chain through various checkpoints and work closely with testing labs to fill that function. And we also function as the transport, the transportation and storage for cannabis. So I would, thank you. Thank you. That your time is up. Okay, thank you. Next speaker please. Good evening. My name is Jenna Shankman as I believe you know and I work at United Way of Santa Cruz County in the community organizing department and I'm a part of the coalition community prevention partners that was mentioned. So thanks to your direction we had the opportunity of collaborating with city staff about advertising restrictions as a form of prevention policy and it was exciting to have this opportunity and really continue to think about youth prevention and public health which is clearly on your minds as evidenced by the health and all policies. So we just wanted to reiterate that in addition to the advertising restrictions which we think will have a benefit by decreasing youth exposure to ads and the use that has been so to be associated with increased exposure to ads and to really receive the full benefit of these advertising restrictions that these advertising restriction criteria should also apply to the signs which are highly visible and shape the landscape in our neighborhoods. So we definitely agree that signs are important identifiers but can be leveraged as advertising depending on what the content of the sign is. So with a simple kind of modification of also considering the content of the signs and applying the same advertising restrictions that were deemed beneficial in other sorts of visual ways that could reach youth. We encourage these restrictions to be applied to signs so that youth who are prone to the influence of symbolism and brand recognition don't have that as much as part of the milieu. So we know that our local dispensaries work hard to be responsible business owners. We've had the privilege of meeting with a lot of them but it's important to have language in the ordinance to ensure that local advertising restrictions apply to signs long-term no matter who the dispensary owner is. These types of clear responsible advertising and sign regulations foster a healthy environment. Thank you so much. Thank you. Next speaker please. Good afternoon. My name is Jim Coffes and I'm here on behalf of Green Trade Santa Cruz. We're a coalition of businesses, local businesses who are attempting to operate in the regulated market. I want to first of all thank you all for your service. I think I'm always whenever I come to a city council or board of supervisors meeting I'm always struck by the dedication and the patience that it takes to do the job that you're doing and I just want you to know I appreciate it and thank you. I trust that you all received the communication that Green Trade sent and so I won't go through all of that again. If you have any questions I'd be happy to answer them but I do want to urge you to strongly consider taking action today on the issue of reducing the tax rates across the board in each of the pieces of the supply chain in order so that beginning January 1st we can begin with a new tax rate. That will give, that will afford you the opportunity to have real comparisons between what your current very high rate is now and what a lower rate would be and you could have three or six months worth of data and come back and look at it again and make any adjustments that you might need to make at that time but I think the idea of putting out an RFP trying to find a consultant, having the consultant do the work and then come back more than likely with the same or similar types of reports that they've given to the county of Santa Cruz or Monterey County or 35 or 40 other jurisdictions that have engaged consultants recently, you could save all that time and money. Thank you. Thank you, Jim. Next speaker please. Hi, Pat Malo, nice to see you guys. Lifetime residents and I'm also the executive director of Green Trade. Also, I have the pleasure of being on the WAM board. Today, as always up here, I speak as a community member. We're in a very positive experiment but an experiment nevertheless and that's from moving from our old medical regulations into a new regulated, heavily regulated and heavily taxed paradigm and the folks who have been lucky enough to move through this, which is maybe 10% of local businesses, 1% of local folks who are involved with this are very lucky to be moving forward. They're very lucky to be doing it in a place in Santa Cruz because 100% of existing businesses were eliminated in most other jurisdictions but we still have this experiment and for this experiment to do what it's supposed to do which is replace the unregulated market and all the associated problems with it which we don't need to make the list, it needs to be here in five years. It needs to stand up and be able to out-compete that unregulated market and so a lot of this system was cast down on us by the state. Santa Cruz City, I always says, has done a much better job than the county and much, much better job than 90% of jurisdictions if not every jurisdiction in the state but we still need to go the distance with this thing. I think that there's a real emergency in retaining local businesses and retaining every piece of that supply chain because we're attempting to replace a unregulated supply chain so we need every piece of it especially the pieces that have been mandated by the state like distribution and testing because without those we're gonna be disadvantaged so thank you. Thank you, next speaker please. My name is Valerie Corral, I'm the director of WAM, executive director of WAM and I'm here to speak against skyscrapers being built in Santa Cruz even if they're out of hemp. A little levity, so I just, I wanted to speak obviously to the taxes, they're exorbitant, we've had a really quite difficult time trying to convince the state that it's necessary to support the compassionate access as a matter of fact we were unable to do so. There are other avenues forward and we'll seek those avenues but the taxation is exorbitant, we have to look at how we not only maintain the service to our community and also rely on small business being able to thrive in this community with many different safeguards in place but January 1st did not, it legalized cannabis but it did nothing to help small business and it did less to help people who were sick and are facing illness and poverty and many of those people are on the streets and back into the black market. Has the black market been affected? Yes and no and what we can do to see how to prevent more people being turned away is what's really profoundly important and I think that we're considered, I mean I want to commend you, the $61,000 must feel good and I want to commend you and all of you, we've worked together for a long time, I'm a member of the community partnership program and it's an important thing that we're doing to see our whole community served, our whole community served. I want to also thank you because we've been sitting, I've been doing this with you all for 25 years and it's been a long haul and I'm grateful for your work. I want to also to remind you to keep your eyes on partnerships and big business coming into our community thwarting the efforts of small businesses to exist and blah, blah, blah, blah, blah, sorry. Thanks, next speaker please. Okay, before you begin, are there any other members of the public that wish to speak to item number 12? This is the cannabis ordinance amendments and update. Okay, yeah, I know you do, you do also? Okay, please go ahead. Hi, I'm Grant Palmer, CEO of Canakruz. We are a cannabis dispensary in Santa Cruz and top 25 tax paying business in the city of Santa Cruz. We are always happy to pay our fair share, just like everybody else. However, in this critical time when we're being asked to make all these improvements to our business, really expensive ones, we need help if we want to stay in business and you want us to exist. The taxes are killing us. We're being killed on one end from taxes on the other end from the illicit market. There's all these delivery services, so do not pay taxes and maybe if there's some way the city could have them pay taxes, that would even out the playing field a little bit, that would be a big help to us. Otherwise, we need a break and I think 3% is a good number. You could hire a consultant and they'd take what's the equivalent of 4% or 5% of tax money for the year or you could just give us a lower tax rate and see how it works out. The consultants don't, they're just making their best guess just like anyone else and they don't really have any information we don't. You could always hire Jim as a consultant. He seems to know what's going on. Tap price, there you go. And then testing analytical labs. It seems interesting to have a syntax on an analytical lab. I'm not sure, that's very unique. I'm not sure I've heard of that anywhere else. We can find another example of that. But distribution and labs, I don't see why that needs to be taxed at all and as far as rest of us, at least give us some time. Give us a couple years so we can develop our businesses so they don't end up all being swallowed up by Canadian IPOs. And as far as advertising goes, we're not a tobacco company. Tobacco kills, we heal. It's a big difference and we don't really feel like we need to be compared to tobacco. Thank you. Thank you. Next speaker please. Good afternoon. My name is Sam Laforte and I'm with West Coast Wellness. As a micro business with a retail license, we want to focus our business on selling and featuring local cannabis products. And moving forward, our goals of providing an outlet for local products face a significant hurdle and that hurdle being the compounding nature of local taxes. For instance, if we were to buy a product from a local grower who sold it to a local distributor and then we sell it at a retail, we just added 24% to the total for our retail clients. And that's on top of the 15% state excise tax and the $150 per pound cultivation tax. In total that compounding local tax affects our ability to fill our goals of supporting our local cannabis companies. And furthermore, as we move as cannabis retailers, we're competing against each other, but the proposed final state regulations, we will be competing against delivery services who will pay no city tax and are likely paying a lower local tax. To compete, we'll have to further diminish our margins with these non-local retailers. And I support the city's recommendations for taxes, but they don't go far enough as they do not affect cultivators and retailers. I think a 3% retail tax, 2% for manufacturers, cultivators and 0% on distribution and labs is appropriate. 0% for distribution was the original staff recommendation back in November of last year when the ordinance was originally adopted. And as we've heard staff say, distributors are wholesalers. Wholesalers aren't taxed on the federal or state level in any industry. They are key and they're paramount to the local industry because they provide access to a statewide network. So we definitely need to decrease the distributor tax as much as possible. And I'll leave it at that, just 10 seconds left. Hey, thank you. Are there any other members of the public that wish to speak to this item? This is item number 12, the Cannabis Ordinance Amendment and Updates. Hello, my name is Henry Lopez. Okay, two minutes, that's perfect time. So basically my only concern is the carcinogens. A lot of people don't understand that we should have more tests on carcinogenic effects of marijuana when one person comes up with a very good strain and is like, oh yeah, this is really good. And all the other providers from out of the towns are like, no, we got the good stuff. Yeah, maybe the THC is super high and the CBD is really high. But as soon as you take past a couple hits off of it, it turns into straight carcinogens and it is deteriorating people's brains. Thank you. Are there any other members of the public that wish to speak to this item? This is item number 12. Seeing none, I'll bring it back to the council for any further deliberation and action. Council Member Crone. Thinking about the way they just talked about the labs versus manufacturing versus retail. When you said 1.7 million, what were the breakdowns from those areas? I couldn't tell you exactly. The vast majority of that is from the retailers because we have only had three additional non-retail businesses that are opened. So it would have been in the last two quarters and it would have been a relatively minor amount. Thanks. What's the reasoning behind the 10% partnership that you can't take on that? That came directly from our tobacco retailer license. We used that chapter as a template for our cannabis retailer license and at the time we didn't see any need to change that particular provision. Since then, the state has come out with a definition that proprietorship is a 20% interest, which I think one of the speakers brought up. And if I might add to that, my understanding too, I was not here when the original cannabis ordinance was passed for recreational use, but my understanding is that there was an interest to make sure that we're preserving the local character of our businesses and making sure that we're giving a fair shake to our local businesses, our women-owned businesses, our minority-owned businesses. And so part of retaining that had to do with making sure we preserve that.  No, that was, it was part of the tobacco. It was also when we were first discussing, prior to the ordinance coming to the council when we were first discussing it, there was an expression from council to prevent license flipping. And so we came up with the process of having, and there was also the limited number. The council voted to limit the number to five. And so in order to have a process where we could limit the number to five and prevent flipping, we had a competitive process for the licensing, and then not allowing transferring just fell right in line with that. And there's no way to regulate, like if a local person wanted to buy it from a local person, is that impossible to regulate? I'd have to defer to Tony on this, but I would think it would be. The local person would have to apply for their own license, and then the business assets could be transferred if the city council approved a new license. Just to be clear on this, the code defines a proprietor as a person with an ownership or managerial interest in a business and an ownership interest is defined to exist when a person has a 10% or greater interest in the stock assets or income of the business. The provision regarding non-transferability says that a cannabis retailer license may not be transferred from one person to another or where there's a change in proprietor. So by definition, a transfer of more than 10% of the assets of a business constitutes a change in proprietorship. And then council member Matthew said a follow-up. I labored over this whole section here, and I still have questions. One of them was related to this, so I just want to continue off this one. So as I read some of the commentary and staff report, transfer of taking on equity partners was equated to transfer of license. But it's not really, it may be adding someone to the business, but not necessarily transferring the license. I stated that as a statement, it's a question. And I think it's related to what you were talking about. But it's, to me, they don't equate to the same thing. Having a license, maybe adding someone, you have a license as an individual, you bring in a partner, but that's not transferring the license. It's expanding the, anyway, that's my question. It's confusing, but apparently it's significant to local businesses. As I recall, that was something that the council thought was very important in the discussion when the ordinance was originally considered. I agree, however, that the intent might have not been to go that far. That's just how I read what you adopted. That's how I interpret it. But the council could clarify that and give direction to clarify or modify that requirement. Should you deem it appropriate to do so? A couple more questions. Yeah, I would just say, that we just related to your talk about them. I know that originally when it came up was about the idea that someone would use the recent changes in the state law to flip their license. And I think the discussion first started with the idea that we wouldn't, we wanted to prevent that. And then it became an outright prohibition on any transfers. So I think that's where it went in that direction, maybe a little too far. Yeah, the staff's not recommending any reduction in tax, I mean, they're recommending a general reduction possibly, but not to any particular level. You're allowing council to decide or did you put a number in here and I didn't see it? We put, for the tax, did you say? Yeah, for retail tax. We didn't address retail manufacturing or cultivation at this time. But you're recommending that it be reduced? In general, we've always taken the position that the evidence that we've seen seems to support that a lower tax is better in terms of competition with the illicit business. There's some evidence that it may also, in the long run, lead to more tax revenue for the city, but I think that's speculative at this point. And last question is, do you think that we're so different than other cities that there's been enough information accumulated that we don't really have to go out to a consultant and ask them what our tax rate should be? Do you think it's enough information that's already out there? Or would you recommend it to a consultant? If I might respond. So I think just to back up a little bit, so for the last time, and when you asked about the taxes, could you repeat your question? Because I did have a comment that I wanted to make to that and I don't wanna lose it. If the staff was asking us to read any particular number in mind that we should reduce retail tax. So as Catherine did say, we do have a couple of proposals here for the testing laboratories and the distribution, but we specifically did not come forward with a number for anything else because we wanted to have the conversation with you. We do have some good background and experience and knowledge about the industry, however, we are not experts. And so we are looking to counsel to give us the direction on, do you feel that there is a tax rate that's suitable based on information that you've heard and based on your knowledge, or does it make sense to have a study done? We obviously will take direction as it is given and be happy to move forward with that, but I just wanna be clear that we don't have a number in mind right now that we wanna propose for anything other than the items that are on the screen before you. Are markets so different that we have to go hire a consultant to tell us what the tax might be? I don't know that that's necessarily the case. I think that that was just the proposal at the time when we put this together, but if council is interested in having us approach it another way, obviously we'll be happy to do that. Any other council, or vice mayor? Okay, council member Roy. Okay, so just a procedural question. Let's say after our discussion here, the council is okay with lowering the sales tax without needing to hire a consultant. Is that something that we could propose here or would we, I imagine we would need you to come back to council with that proposal because it needs to be notified to the public? Is, would that be correct? Actually, the notice that we sent out was general and it simply said that we would be revising our tax rates. That said, I would defer to the city attorney on the actual legality of that. You do not have to adopt what's proposed here. The council could make changes this evening and bring it back for a second reading at a subsequent meeting. So you can make changes from what is proposed here. And it wouldn't require needing public, it wouldn't require public notice as a first reading because we're pretty open. We hear on what we're doing. I agree with the characterization of the notice. It was broadly worded enough to give the public notice of the fact that you're considering changes to the cannabis tax regulations. Vice Mayor Watkins. Thank you. And thank you, staff, for the presentation and the just very thorough and comprehensive report. I know that there's so much going on. And I recognize all the sort of considerations to take into mind here. You know, with the state at the 15%, I know there was recent policy to lower that to 11. And I think some of the work and some of the thoughts that you have here in terms of how we, as a local government, can advocate to our state representatives and possibly to the League of Cities that we do want to see some of these fixes at the state. I think a lot of them do actually lie there. And then I also recognize that it's really complicated to identify really what's right. And I also understand and honor the businesses that I have had honor to also work with in many ways in terms of their commitment for use in our community. And so I also recognize their perspective in terms of the business. So there's a lot of different sort of layers and lenses to look at when we're thinking about this. I appreciate your proposal here. I mean, for the purposes of discussion, I'm prepared to move a motion if I want at this point. Okay. So I mean, I'll move the recommendation as, but with a few additions. One is I support the Community Prevention Partnerships ask to, no, I can't find it in my paper, to, okay, I'll have to find that later. But I support the Community Prevention Partnership one that was very specific to the signage. I also want to say that I appreciate the recommendation and consideration about changing the policy for the Children's Fund. I would like to support that as the direction for staff to reflect that as commensurate to the existing 1%. So the tax changes to, and- If the tax changes that that's what the policy will reflect, but to move with that as- It would still be 1% of the total tax. That's right. Not of each individual. That's right, that's right. I think that, you know, if the will of the council is with me on this, I'd like to see if we can write a letter, have the mayor write a letter to our state representatives or the League of Cities to express our hopes for them to do some shifts there at their state level. I support also the fact that we're changing the things that we can do, like exempting non-cannabis goods. And then also, I mean, I'm open to a conversation around the consultant. I personally, as somebody who likes more information would be happy to do that. I think if not, we're sort of arbitrarily choosing numbers. And I didn't necessarily see the evidence, although I understand the different kind of ways, I don't know how you could find it, right? There's so many different things to take into consideration, but they didn't necessarily say this would be that. And that, you know, with the city of Santa Cruz being different than some of the other jurisdictions, such as the county, I think having a consultant look at the numbers would be helpful for me particularly, but I'd be open to that conversation. And then I really want to just also thank you for sharing the information about the minority and women-owned businesses. I feel that we have a responsibility to repair some of the harms of the war on drugs, and that I'd like to see how we can continue to find ways to bring equity into the industry and have opportunity and access of empowerment for minority people who have been disproportionately criminalized for that. And so that would be my general recommendation, and I don't know if I didn't cover anything. So your motion, as I understand it, is to move forward with the ordinance as presented. You want to incorporate the recommendations by the CPP in terms of signage. Do you want to read that? Yeah. So Vice Mayor Watkins, I found the letter from Community Prevention Partners, but I'm not sure which part you want, is it? Maybe I'll just, so you're moving the recommendations with the only changes that you'd want the advertising, that the cannabis advertising restriction language be applied to sign content to continue, and so that you would not make the changes that were recommended by staff, but just keep a consistent signage. I believe that there was a number of different changes that were also in alignment with the Planning Council, but there was one area in regards to the signage. Is that correct? Right, I believe what CPP had objected to was that the restrictions on the graphics and images on the signage. You know, if it's okay with, go ahead, Belen. This is not it, so. Let's, we're going to work through this. Go, please go ahead, Mr. Butler. Good afternoon, Mayor and Council Members. If I recall correctly, there were two comments that CPP had that were different from the staff recommendation. One was the square footage, so right now, the square footage of signage for cannabis businesses is limited to 20 square feet, and the second is the images, the image restrictions, and so they were recommending image restrictions and the 20 square foot limitation. If I recall correctly, I'm looking to the team. That's right, there's two pieces that's helpful. And then the staff recommendation that was proceeding, which I believe also was the Planning Commission recommendation, was to allow the same square footage as other businesses and not have the image restrictions as it comes to signage. So the council could mix and match those or propose just CPP recommendations. Okay, so I'm opting to advocate for the CPP recommendation, the CPP. I would go with the CPP recommendation, sorry. I am, I think, prepared to second the motion. Okay, let's go. I understand, I agree with the staff's recommendation that the size restriction be the same as for all other signage in the city for all businesses. That was one issue. The other is the restriction on images, and I'm fine to go with the image restriction. That's fine, restriction. Okay, so partly accepting staff recommendation on size, but following the CPC recommendations on, Sure. Limitation on images. Okay, I accept that. So, just again. I think that changed, yeah. To review, accepting the staff recommendation on effective immediately lowering the tax rate on two of the categories. Include communicating with our state representatives regarding re-examination and lowering of state license and fee amounts. I personally would like to see the engagement of a consultant. To my mind, it's a short-term, very discreet study. And I'll just say, we clearly see an industry in rapid change, and this is not going to be the last pass at this. I am very interested in lowering the tax rates on the other categories. I want to come out of the chute with that. Things are changing at the city, at the county rather, capital is coming online. I did read the whole report on Monterey. That was done in March, and that's still changing, and things are just changing at the state. So, I think this can come back to us pretty quickly, I believe, at, I think, a reasonable cost that is relevant to the city of Santa Cruz and our county. And that would serve us well as we make additional decisions. But I would like to see local information before we delve into this any further. So I would like to include in the motion that we engage a consultant to prepare a report on what we know of the costs to at the state level and at the local level and the regional trends. So I'd like to include that in the motion. So, Council Member Narion. Oh, I don't think we need to spend the time and money on a consultant. So many other cities have already done that. And cities that are close to where we are located, and when you look at after they've seen the study and hired a consultant, many of these municipalities have dropped their tax down to three or 4%. So I don't think we necessarily need to go out and spend the money and the time to get this analysis. I would like to just propose that we lower the sales tax to 3% and as things change in the industry, we are welcome to go ahead and increase that. I'm also interested in looking at being able to allow licenses to transfer, as long as they have the same background checks that's required of people applying for new licenses. So let me just say before we continue discussion, there's a motion on the floor by Vice Mayor Watkins and a second by Council Member Matthews. And so you're advocating that those changes be made as part of their motion. I will say, and it's your motion. I agree with reexamining this whole addition of equity partnership and to what extent that involves is or is not a transfer of license and so forth. So that's different than a tax rate. So I would give direction that staff come back to us with more information and options on that particular issue. I think that's another one that needs to be resolved. That's fine. Okay, that's great. But it sounds like he's still gonna agree with me on the three, four, six, five. I'm not gonna pick a number. Council Member Cron. When you said 3%, where was the children's tax on that? I would still say to maintain the 1% for the children. I would not advocate for getting rid of that. I think the council is pretty strong wanting to support that. I completely agree with you about the consultants. We don't need any more consultants. I think that there's enough information out there on this. I also would like to say 4%, but I could live with 3% because I think that we're hearing from the experts who are here today who've been in the trenches for years and years and years and they're telling us this is not working. And I really think that I don't think what is in the main motion is dramatic enough. I don't understand why we wouldn't go toward lowering the tax. I'm fine with lowering it to 4% or to, you know, going from three to four with my original proposal, but I don't think the maker of the motion or the person who seconded the motion agrees with that at this point. Taking that step at this point. I'd like to ask staff, how long do you think it would take to get a turnaround on a report, consultant report along the lines I described? Is that a Lee question? We'd have to go out with an RFP. So I think probably minimum four to six weeks and that would be a miracle. And that would be just for putting out the RFP, getting the analysis and the study done would be additional. That would just be the study. It wouldn't be us coming back to you with the study. Like March. I think that's probably fair. February or March to be realistic with the holidays and. Maybe with that pause, just I'd like to. And if I could, just continue this question. I did read the Monterey report thoroughly. And so there's a lot of information there. What's the staff capacity to do something along that line internally? Yet another work. We don't have the data they have. They have access. This is a company that has access to all the sales tax data. We just don't have that data. We can look at what other cities are doing and bring that back. But that's not exactly the same. If I may. I think there's so much variation if you do research what cities are doing from 20% to 2% and over the hill there's a couple that are at 10% and a couple at 8%. And we have a university and a tourism. I mean, there's so many different unique considerations. I think just, I don't feel like I have enough information just to arbitrarily sort of choose a percentage. But at this time, if anything, I would look at what I think I do know, which is sort of a little bit about what we have in our county, which is around the five to incrementally go to seven, which would mean for me, if anything makes sense, it could be to kind of follow something like that. At this time, if the interest is not to have the actual report. Well, rather than going to, first of all, before we go into the specific text, I'd like you to first restate the motion so we can make sure that everyone's speaking from the same page and then we can go. So, I move that we accept the recommendation to reduce the tax for businesses that are conducting testing laboratories and distribution as staff recommended. I move that we direct staff to return with a change in the children's fund council policy that encompasses a percentage that's commensurate to the 1% currently adopted by council. I move that we adopt the sign, that we adopt the staff recommendation for the sign size and I move that we adopt the sign content recommendation from the community prevention partners. I further ask or further sort of identified interests for looking more into having staff research the transfer component of it to also continue to look at local and minority women as a priority population that we want to engage in the industry. That does not encompass anything regarding what I previously had in the motion around the consultant to get the tax rate. So, if we want to vote on that and then have the discussion. I remember, Matthews, is that, do you second that? So far, yes. Okay, there's a second on those items. What about the business raising the partner thing to 20% where they said the state was at? That was for said she's given direction to look at that. Okay. Yeah. So, It also, I think it was implied in what you said exempting non-cannabis retail products. I mean, that's part of the staff recommendation. Is there any further discussion on that? I have a question. Yeah, Council Member Naroyan. You took out the provision that we do a study. I thought we were going to vote on that and then have that discussion. Is that right after? All right. Yeah, I appreciate that because I do, I may do that as the rest of all the other provisions you put forward. And when is it going to come back to us as far as the retail tax? Come back. After we vote on this issue, I was planning on putting forth another motion. Okay. I'll second that. I heard this discussion. Yeah. Okay. I'm going to say all those in favor of the motion on the floor. May I clarify something really quick. In your previous motion, you had said something about directing the mayor to send a letter. That's right. I'd like to also incorporate that. Yes, my motion. Okay. All those in favor of the motion on the floor by Vice Mayor Watkins, seconded by Council Member Mathews, please say aye. Aye. Any opposed? That passes with Council Member Brown absent. Now, Council Member Naroyan. I'd like to make a motion that we lower the sales tax rate to 3% and to not commission a study or report. I'll second that. And you are silent. And I'm seconding it because, you know, this issue has been put off for so long right now, weeks and weeks and weeks. And we've just heard incredibly expert testimony from our community. And so that's why I'm just like, you know, we can do this now and we can revisit it and raise it accordingly. And if people want to put a date on it, we can bring that date back. I would say this, if you, you know, this is the maker of the motions willing is to direct staff to analyze what the impacts would be if you were to do the tax and come back to show what the amount of loss of revenue is and then come back to Council to say, hey, this is what it means. It's easy to say the tax, but I mean, I appreciate you putting that on the floor for discussion, but at least some of these things can be done in-house and don't necessarily require an outside consultant. And I think that very issue you brought up is one that can be done. The only problem that I have for this is that we've been saying we were gonna come back and revisit this for a long time.  And here we are in the month of October. So that's my hesitance in supporting what you just stated because I think that's something. That could have come forward sooner. City manager? So I was just checking with staff to see if there were anything we could do to fast track the analysis process and then talking very briefly to Marcus, he thought that we could do that, do some fast tracking. So maybe Marcus can come out on that. Yeah, I just confirmed that. There's some things we can look at to expedite the selection of vendors. And certainly on the fiscal analysis, if you have an idea of rates, we can run up some costs in areas of what the fiscal impact would be. Keep in mind, this is a general fund revenue base, I'm not advocating for or against anything, but there is a fiscal impact to the general fund from changes. But this is one of those cases though, where less might mean more because we know that there's a certain point of taxation where people will not go to the legal market, but will go to the black market to continue buying their cannabis products. So if there's a price point and it's been shown to be at around 4%, three or 4% where people won't buy it in what we call the legal market now. And so I think it'd be really hard to analyze that because from expert testimony, from other folks and part of the industries are showing that sales actually go up and revenue goes up when the taxes aren't as onerous. Vice Mayor Watkins. I definitely hear you in terms of wanting to understand where that threshold happens, in terms of the illicit market. But I think there's also the other considerations for the zoning and that's why I didn't feel like I adequately had enough information to make that call at this time. I think that if you're hoping to have action, one thing that I'd be willing to support while we internally maybe look at what's possible for our city is adopting something that's more aligned with what's happening in our region like the county's sort of framework essentially. I mean, that would lower the taxes for cultivation and manufacturing to five and then put it on a timeline for the 7%. That to me seems something that we have a little bit of information that is relative to our county that makes sense to me. The 3%, the 4%, the 5%, I just don't have enough information today to make that decision. If it does come back that that's the right threshold, then I'd be happy to consider it then. I feel like I do have enough information based on what's going on in other counties. I have a question. Yeah, Council member Matthews. Your suggestion was just to lower the tax on the retail only. That's correct. And so leave it at 8% for cultivation and manufacturing. No, because we- Well, that's what you said. No, I didn't, because we just recently, we just passed in our previous vote to lower it for manufacturing, right? For- For distribution and testing. Right, I'm not talking about the other taxes. I'm specifically only talking about the retail tax. Okay, so we understood what you said. Not supporting lowering the other ones. I tend to support Vice Mayor Watkins' perspective in terms of looking at like that. If we're gonna make any changes right now without the consultant, then I would go along with what she's recommended. I'm not prepared to support the motion on the floor. Well, I guess I'll vote for it and we'll lose and then you guys get your post. So we have a motion by Council Member Naroyan. A second by Council Member Crone. All those in favor, please say aye. Aye. Okay, those opposed? No. Okay, that fails with Council Member Crone. Council Member Naroyan voting in favor. Council Member Matthews. Council Member Chase. Vice Mayor Watkins and myself opposed. And Council Member Brown absent. Do you want to make a motion?  Well, I would just say I would have been willing to go forward with the 5% on that. And I'm also not super excited about getting a consultant. I would like to see if we could get some more information about this internally, if we can and avoid going to a consultant. So, I mean, that's where I would stand right now is can we get a little bit more information than we have? So we're not picking an arbitrary number, but we're not going to get a full study, but we have a little bit more local data to help us make this decision as quickly as we possibly can. Council Member Matthews. I'll just suggest that we ask the staff to come back at the earliest possible time with additional information on reducing the tax rates for the remaining categories, which as I read it, is retail, manufacturing and cultivation, bearing in mind both the impact on revenue to the city and the longer term desire of supporting the industry and reducing the impact of the illicit market. So I'll ask the city attorney, is that something that you could prepare? Like, do you need motion in formal direction? Is that something like that staff can kind of bring forward? I think it's that the consensus of the council. I think that seems perfectly reasonable at this point. Okay, you guys, as early as possible time. Yeah. Okay, great. Thank you. And I just want to state that my number was an arbitrary. It was based on seeing what other communities are lowering their taxes to. I didn't just pull the number out of a hat. So I just wanted to make that really clear. And mine was based on our community experience. Thank you. That concludes all the item on number 12. We're going to be going to, right now, oral communications, we did, we voted on that. So we're going now to oral communications. And I'd like to, pardon? Yeah, yeah, yeah. Thank you. I wanted to invite up, first of all, for oral communications. I know there was a time scheduling, so Gail Jean and Senator Monning is visiting with us. And Gail Jean, if you'd begin, this is, you had four minutes, she asked. I don't think we voted on that. We did. I, we sure did. We voted on that. On the LAMI amendment? Yeah. So that was no other motion put forward. No, there was not. To come back in the early stage. The direction of staff. Got it. No motion. Okay, so we're clear on that. Yeah, thanks. Okay. Okay. Thank you. Gail. Thank you. Yes. Can you hear me? Yes, sir, I can. All right. Thank you, City Council, for the opportunity to speak. My name is Gail Jean McGuire-Sias. A few weeks after my Daniel's fatal tragedy, I woke in the middle of the night raising my voice out loud, screaming, there should be a law. Not realizing how difficult and challenging it would become. The next morning I contacted an acquaintance, Paula Mahoney. She became the backbone and the communicator, the encouragement who has now become my true friend. Together we reached out to friends and family and recruited Lynn Robinson. By appointment, we all approached our Senator Bill Monning, who truly believed we could make a law. With that encouragement, we all went to work. This, we came in front of this council, where Cynthia Matthews wrote and endorsed us. Thank you, Cynthia. Then to Capitola, Watsonville, Scotts Valley Councils, Sheriff and Fire Departments, Paula with Help created a webpage called Daniel's Law. We made shirts, we went door to door, set up tables in front of stores and businesses for signatures and endorsements. That was not difficult. With this momentum, a tribe of us went to Sacramento and spoke individually to the transportation committee with our Senator leading the way. Then over the next four years and each stall, with more visits to Sacramento, I recognized time moved away from the momentum. The lawsuit settled, Doug lost his daemon, his brother, that our faithful attorneys lost both of their moms, Jessica had baby Taj, my daughter Reggie was pregnant with my grandson, and my encourager Paula had taken on another project and her family needed her. Our last visit this late June, there were three of us and Senator Monning, his staff Trevor and Rachel and a committee who had heard and our request many times. I knew this project was divine and felt both Andrew and Daniel's presence. With that being said, dear Senator Monning, our entire family along with a circle of friends who've supported us over the past four years want you to know how grateful and relieved we are that SB1236 has finally passed into law. It was a very long road and with Governor Brown's signature, I am so proud this legislation will protect the entire state of California for years to come. There are many times along this road when our grief well felt too heavy and passing the law felt too far out of reach. It was because of your support and the outpouring of love from Santa Cruz community. That we are inspired and we persevered. We would sincerely like to thank you and your entire staff for your determination and the long hours of hard work that it took to see the process through. It meant so much to us that you were truly moved by our family's loss and always willing to deeply listen. Each time we met your warm heart and personal interest and making our roads safer is part of what kept us feeling hopeful and able to find the courage to raise our voices in Sacramento. You said from the very beginning that not every tragedy could be prevented by changing a law but the events that led to Daniel's passing pointed out a gaping hole in California law. The lack of behind the wheel training for newly licensed commercial drivers. We will never be able to measure the lives that will be saved by SB1236. But we do know that the life of Daniel McGuire has now served a higher purpose. Thank you, Senator Monning. Four years is a really long time for all of us. So many things happen in our lives but for the friends and family of people who have lost their lives, it is an unbearable amount of time. The trips to Sacramento were arduous and the testimony sent all of the family and friends back into the tragedy many, many times. Trying to think of the things that aren't going to be said. So grateful in this era of kind of a lack of civility and public discourse that all of you who were on the council at the time that we came to not only listened but were willing to take action. And that is so true of Senator Monning. The graciousness and generosity that he showed and not only his ability to listen but to also figure out exactly what the hole in the law was that could be somehow mitigated through a change in California law that it took hours and hours and in fact, four years of negotiations to make it come true. When I tried to get through what I was going to say this afternoon, I thought I had it all together but I lost it completely because the sorrow never goes away and I think in the room tonight there are probably 20 or 25 people who are just some of those who came to Sacramento with us. It's always hard to speak truth to power but when you're a grieving family, it's just really, really tough. And I have so much respect for all of the people who have been involved. It really has restored my faith in government. Thank you so much. Thank you. Senator Monning. Mr. Mayor, council members, staff, community, thank you so much for this opportunity to close at least the legislative chapter of the tragedy and the loss of Daniel McGuire from the start, from the outset of this being brought to my attention. It was Daniel's parents, Gail Jean and Doug who's with us this evening, Daniel's sister Regina and Paula Mahoney who you just heard from who really did provide a support system for the family that helped to channel not only the grief but to activate a community response. I acknowledge the city council for its support, former mayor Lynn Robinson for her leadership in helping connect the family, both with the city council and with the county board of supervisors. As Gail Jean mentioned, not every tragedy should or can result in a legislative path or a legislative remedy. As we looked into this one, however, we learned that that tragedy on Route 17 could have been prevented, should have been prevented and that the tragic loss of Daniel McGuire was unfortunately the loss it took to wake up the state of California. But then our legislative journey began three separate efforts to move this through the California state legislature. Both times we made it through the Senate without any problem and we hit snags in the assembly. We hit snags with special interest groups. We hit snags with agriculture. Gail Jean acknowledged our staff person, Trevor Taylor, who I'm sorry can't join us this evening but we will share with him the proclamation or the framed news coverage and letter. Trevor never gave up, we never gave up but we were emboldened by the engagement of Daniel's family and friends. Every time we had a hearing in front of the transportation committee in the assembly, they were there. To me, part of the tragedy was having to relive it and retell the story time and time again. We were able to thread the needle and find a path that worked and got it through this year and secured the governor's signature just a few weeks ago. And so now moving forward, anyone who applies in the state of California for a class A driver's license, that's a big rig, double rig that drive our roads every day will have to have behind the wheel training because what we learned was the driver in that tragedy had no behind the wheel training. In fact, he was directed to use Route 17 by his boss to avoid the scales on Highway 101. So they were breaking the law just to be on Route 17 but it was the family's perseverance and persistence. Nothing will bring back the life of Daniel McGuire but this law will be a living testament to his legacy. It will be known as Daniel's law and every truck driver who is licensed on our roads will have to have behind the wheel training. And as Gail Jean said, it will save lives and it will be impossible to quantify how many other McGuire families will be spared the tragedy, the suffering and the grief that this family has endured. So we thank the McGuire family, we thank all of you, we thank the community and friends and we also welcome with us this evening, Regina Scarpello, Daniel's sister with their new two month old baby son, Sage. So Sage will help carry that spirit of Daniel McGuire. Thank you all. Viva Daniel McGuire. Thank you Gail Jean. Thank you Gail Jean and thank you Senator Monning for all your work to pass this law. I'd like to just on this topic if any council members would like to say anything. At this point. I think it's been said there's a lot of heart here. And I just thank you for all the family that are here present as well in support. This is, I don't want to thank you for being here. Thank you. Okay. We're going to continue. Thank you. We're going to continue with our oral communications for items not on the agenda. Is there any members of the public? You should be lined up to my left. You can begin. Mr. Norse, did you want to, Mr. Norse, would you like to begin? And he asked for, he asked for four minutes. Yes, yeah. Okay, members of the community, those who are remaining and members of the council, the river street campground, city manager, Bernal tells us, is slated for dispersal at the end of November, breaking the promises by his underlings, Susie O'Hara and Tina Scholl, that it would last through the winter until April. Instead, the population will be shoehorned into a small nighttime only shelter leaving little or no room for other winter shelter refugees. This winter shelter hoax had its rough draft in August when these two bureaucrats announced without saying so, that there would be no winter shelter. The so-called expansion of the Pauley Loft and the river street campground promised referred to programs which had long waiting lists, no walk up and no first come, first serve options. The vehicular park, which was promised 50 spaces has apparently been abandoned because of bigot pressure from Nimbis. We shouldn't be surprised. All prior so-called winter shelter programs were PR fig leaves that offered shelter for less than five to 10% of those outside. But this time, the community has some choices it didn't have before. Federal court has ruled in the Boise case that unless a city has enough shelter for its homeless population, its laws against survival camping are unlawful. This you would think would prompt Chief Mills and new PNR boss, Tony Elliott, to pause in their generous use of trespass and no resting in the park at night citations, which however have massively increased in the last year. Camping tickets are still being unconstitutionally given, but less so. Police now have probably the support of city attorney Tony Condati begun using other anti-homeless laws to attempt to ticket away those outside. Last year, the appearance of so many visible homeless people in public areas at night as well as a HEPA outbreak in Southern California may have prompted the tolerated San Lorenzo campground in the bench lands and the facilities open there. And this year, we see hardened cruelty of an anti-homeless agenda and operation. Fences all around San Lorenzo Park, the closing of the bathrooms there again, as the ones outside these chambers are closed and locked day and night when this council is not here. New fences are being raised around the post office, perhaps to discourage Food Not Bombs workers from supporting those who choose to sleep together at night outside the main post office. There is no legal place for folks to sleep, so they must sleep where they must. Instead of spending resources to open up spaces, even like the limited San Lorenzo campground last year, city tight wads are putting up fences, funding whack-a-mole type operations and endorsing the downtown association's private downtown snitch program, which it pompously calls ambassadors. These visible attacks on poor people outside are risky. What do we need to do? Support real homeless people, not the pathway to poverty programs. When will the homeless lack of services center restore meals it traditionally provided? Remove its gates, ID checks, guards on low impact zone. When will groups like Smart Solutions take real action to demand those outside not be treated like pariahs fleeing police, facing locked facilities and braving nighttime vigilante surveillance and harassment. Agencies receiving the big bucks and city recognition are not providing the vital services that need to be seen and they need to be seen for what they are. Those who care can then support homeless people directly or through agencies that actually provide more than closed waiting lists, phone numbers that don't answer. There's plenty of campground space in Santa Cruz if the bleeding of bigots is ignored. Conscience in action and huff meat tomorrow at the Sub Rosa Cafe at 11. Come to a Food Not Bombs meal Saturday or Sunday at 4 p.m. outside the post office. If there's any sidewalk space left not fenced off, support the day and night shelter program of Brand Adams. Keep your ears open for the call to support next steps for a meaningful emergency shelter alternative. This may mean a coalition of renters, students, the disabled, the elderly and other marginalized groups. One thing is sure, it's not coming from this council. Thank you, Mr. Norris. Next speaker please. My name's Kate Oates. I live on Market Street. My son, he goes to De La Viega Elementary School and he also takes the bus at Grant Street Park. I was made aware of the closure of the park the day before. I believe that we met up at the park. We did have a city official that met with us. They were talking about the beautification that was going to happen and the fixing of the bathrooms. There was nothing mentioned of the temporary homeless shelter that was also closed. So I feel as a parent a little duped that we were told what was happening in our park and it is our neighborhood park. And now currently we have like 30 children and parents who are standing huddled against a fence that is not open to us in the morning when the bus comes. It is an unsafe situation at the moment. And we are also not given a time for when it was going to reopen. So there's that part of it. I am part of the community who is trying to support the homeless community in town. We may not be as loud as those who are against it. Who want the temporary homeless shelters closed. We are actually meeting this weekend, a group of us from our neighborhood, from the Grand Street Park neighborhood to discuss ways that we can move forward and help what is going on in town. But the fact that it's being closed before the rainy season is very disheartening to us. We are concerned about their safety as members of the community. And just frustrated with the amount of communication that we're hearing also. Thank you. Ms. Oaks, if you could leave your email address, there's an update that's been posted on our city website. And so we have information that way. And then also there was a slide presentation that was given earlier today that we can send out. So your neighbors will have that as part of your presentation. So if you leave your email address, we'll make sure that that goes out. Sure. Okay. Does that also include the bus stop issue? Bus stop, I've already emailed the city PD and city manager about. Thanks. Yeah, next week. Can we get a report back possibly? Sure, I'll follow up. Next speaker, please. Hello, council. My name is Dora Berlanga and I am a community member for over 40 years. I've lived in this community. I've worked, I volunteered. I've done quite a bit here.  I also work for the river camp shelter. I was also here when you guys had your meeting when you guys extended the date. It was the proudest day, one of the proudest days of my life when you guys extended that to April. I go home to work and I kind of find out you guys are closing us in the mid November. You guys lied. I don't understand how you guys could all sleep at night with this being known. A winter shelter, a joke. Okay, it's really a joke. People only lay their heads there. River camp provided these people a home, a safe place where they can lay their head, leave their personal belongings. Go look for work. And if you guys would just come and visit the camp, you'd see that the self esteem of these people have gone up. Mine has, I'm homeless as well. And now you're taking my job away. You're putting me back out on the street with the rest of these people. How can you guys do this? You guys downright lied when you said that you had enough funding till April of next year and now all of a sudden, boom, no money. Where'd it go? Where did it go? Fences. Seriously, are you spending it on the fences, putting it around the parks? Now you're not only closing me out of the parks, you're closing up people that do actually have homes. Again, I've been in this community and I have faith in this community. I've gone to school here. I've done my part. And now you're kicking me out on the street again. Why? Come visit the camp. Half the people that live there have gotten jobs. They are, they look forward to life. They're not dealing with the criminal elements that's out there. Just because we're homeless doesn't mean that we're criminals. I'm educated. I'm a retired firefighter. I've done quite a bit. Don't, you know, anyways, I'm just gonna leave it at that, but you guys lied to us. Thank you. Next speaker, please. Hi, my name's Cherie Peterson and I started talking to you four years ago about my hundreds of dollars worth of tickets for having the audacity to fall asleep in my car. And then I, and lately, in the last four years and one month, I've been living in the street period in the flat out dirt in front of dentist's office, doctor's office, behind coffee shops everywhere where other homeless people are this far away or whatever. I've had seven sleeping bags robbed. So many things robbed. It would take years to tell you, but I just wanna say that, you know, you keep promising you're gonna build a shelter for us when San Francisco's built 10-story apartment, San Jose's built eight-story apartment. What is Santa Cruz doing? They're going, oh, we'll think about it next year. We'll think about it next Tuesday. How about, like, never, it's never, you've never broken ground on nothing. There's a 32-bed shelter over there. I've had my name in for four years. I was in the hospital for five days recently. I have a lot of health problems. I'm legally blind. I'm handicapped, but I'm out there on the street. Luckily, I have my walker to carry all my junk around. I go to Cabrillo, you know? I don't let homelessness stop me. I just carry on because I wanna have a house.  A lot of us don't drink, we don't do any drugs, and we wanna home. And what's your solution? What's your solution for the winter?  Three fingers froze. I froze my face. I froze my arms trying to find my son, you know? And I just can't see going through another winter having nowhere to be. Thank you. Next speaker, please. Next speaker. Are you up? Go ahead. Next speaker. I'm not really too sure about what to say about the homelessness. I am personally homeless myself, and I'm contracting and doing studies in the National Forest. All I gotta say is that the homeless crowd is always out on the streets, and you know, they're usually having a good time. There's not really too many people that are out there causing that much trouble. You know, I occasionally hear the cops running this way, running that way, but honestly, I think the homeless crowd here is one of the best homeless crowds that I've actually had time to participate with. Like, I have really good friends here. Like, the pirate and his girlfriend, they're awesome. And like, everyone else that I've, you know, hung out with in this town, like, they're here. And I just wish that a city would get together at least like a test or like, some sort of like chunk of property or something to start for like, you know, people that actually have the ambition to become successful through, you know, self-sustaining themselves. And exactly like, you know, the women that have been up here have talked about, had brought that forth, so I just want to touch bases with that. And yeah, what I'm finding out in the forest and with the evolution and, you know, cross-contamination through all the past year's poisons and stuff is kind of scary because, you know, I'm a man of God and if we don't correct certain things then this world could become toxic and revelations might come sooner than we expect. Thank you, next speaker please. Next speaker please. Hello, my name is Fran Swass. I have been here about three and a half months and I'm here to show support for the people that don't have a place to call home. I'm here to support the people that are trying to sleep. Animals need to sleep, bees need to sleep, birds need to sleep. The monarch butterflies, the sea lions, they all need to sleep. Without sleep, you can get sick. And so I say when you have people that are going around waking people up who have no place to rust their head but on the ground, on the earth, you're giving them a death sentence. I want to tell you what happened to me about a month ago. I rented a room from a woman who was very kind and she charged me $400 to stay in one room. So I would have a place to stay while I looked for a permanent place to live. I moved here to be near my grandchildren. I was walking down the street, front street, I had bought some groceries and I had bought too many groceries and I tripped on the sidewalk and all my groceries fell on the ground and I fell on my knees. Eight people walked by, they were clean, well-dressed. One looked like he was a businessman. They didn't say anything. They didn't say, do you need some help? Are you hurt? What I felt when they walked by. First was shock. Thank you. Thank you. Next speaker please. I don't like public speaking, so I'll be quick. My name's Maya and I'm an early childhood educator and a grad student here in Santa Cruz. I'm coming to the city council to ask for more compassionate and dignified way of treating those in our community that are experiencing homelessness. Things really shifted for me recently. My mom's from the UK and my cousin came to visit and she was just horrified by what was going on in Santa Cruz. She kept asking, how does your city, how does your country allow this to happen? She'd never seen homelessness like we have here. She just couldn't understand and she didn't wanna come downtown at all. And then it made me realize how horrible our conditions are here. I really want the city to stop criminalizing people who sleep outside and to save money by providing real and dignified solutions, not just fencing off the post office and fencing off parks and not just private security and police giving citations for trespassing. I wanna see more access to bathrooms for people who sleep outside and access to services despite backgrounds and IDs and all of that. So thank you. Thank you. Next speaker, please. Hi, my name's Sean. I do water filtration in Harvey West and bike along the levee quite often. And I just wanna say that the fencing I've seen go up and the winter shelter close, just really depressing and kind of embarrassing for this city. And I know that there's better solutions out there. I volunteer with Food Not Bombs and the winter shelter and their great programs that provide for desperate needs for holes in the services provided by the city. Literally the warming shelter. We're trying to have a place for people to just be able to store their things, which is kind of mind-boggling that people aren't able to do that safely. And it's just really depressing time to be young in this country and just watching the homeless situation get worse over the decades while the rich get richer and the poor get poorer. And literally Santa Cruz has some of the most expensive housing in the world. So I don't know how there's not money for it. I live by the outlook apartments that was just sold for $50 million to apparently I heard Goldman Sachs and I'm just here to demand more progressive solutions to a population that's really suffering. I went to college and work full-time. I have a hard enough time paying for rent and the low income in the city are just really suffering. And I demand more support. Thank you. Thank you. Next speaker, please. Pat Kittle of Santa Cruz. I have a sign here, which I've been holding up. No more wars for Israel. Israel did 9-11. That's a lot of evidence for that and an investigative reporter right here at UCSC by the name of Christopher Bolin. Bolin.com will provide you with an overwhelming amount of scientific and forensic evidence that, yes, Israel did 9-11. The council members are all looking away because this is a fact they don't want to confront. That's to be expected, totally to be expected. But we give Israel welfare that 7,000 times. No. Unhold it. Put on pause, please. Oh, no, don't block people. Yeah. But thanks. The foreign aid we give Israel, get this, this is a fact you can verify it easily. It's 7,000 times more per capita than the foreign aid that we give the world at large. And Israel brags about its booming economy and its brilliant scientists and blah, blah, blah and how well they're doing and yet they're taking this kind of welfare from us and you just heard everybody express the idea that we're not particularly wealthy ourselves. Israel keeps doing this and that's this pocket change compared to the wars that Israel has sucked us into. That's coming to trillions, trillions of dollars. And that's not even counting the suffering both here and abroad. So I ask people to look this up. Bolinbyon.com. Don't take my word for it, look it up. Thank you. Next speaker, gentlemen in the blue will be our last speaker for all communications. Please go ahead. I emailed you before, can I have four? Yeah, go ahead. I'm representing Stepping Up Santa Cruz and we did a new resource, homeless resource directory. You can find it on the website or on the Facebook page, you might want it and we're gonna, it'll probably, oh, sorry. There's a new homeless resource directory on the Stepping Up Santa Cruz, sorry. Website and I'll update it to see any corrections. Please let me know. I have some information, some questions and then some proposals and I'll talk fast because I don't know what four minutes is, sorry. During the city manager presentation on page five, it said that when you guys voted, you voted for the River Street Camp Extending in absence of another half winter shelter option. I don't think that's what you voted for. I think you just voted to extend it. So maybe I miss that, like I think you, yeah, I think you're changing the vote now if you're voting to close it. So I would ask what specifically that vote was. Okay. The, in response to your question, when you asked, did the HAP General Board get to give feedback to the executive committee? City Manager said that the HAP General Board was at a meeting about priorities. We were, that was different and Council Member Nourian was there too. And, but we were never in any sort of meeting to give any feedback about winter shelter options. We were told afterwards, just to clarify that one. When in the newspaper it said the HAP Executive Committee decided to give money to the homeless services center, and that's actually city money as part of that. Don't you guys have to vote on that? Does the city manager, can they allocate money? Because it totals like $67,000, $68,000. So that's a question too. In the presentation with the closing the parks, the same as the first person who spoke, it seems like there's some connection between the closing the parks and the fence being put up around San Lorenzo Park. At the same time that the River Street Camp is closing, I would ask if that was part of the discussion because in the presentation, there was no connection to it. Okay, because, yeah. A few things about the HAP Executive Committee. There have been no RFPs put out for winter shelter programs. There's only been conversations with particular groups and that's one of the reasons why there's really few options because it's a very closed conversation. I would say if you want more people at the table, you should invite more people to the table. The HAP Executive Committee does not do any oversight of any programs at town. All the nonprofits and their outcomes, they don't have to answer to the HAP Executive Committee. It's just sort of assumed that they're gonna follow HUD guidelines, but no one's actually checking. So as you're deciding about where to put your money, you should be allowed to see what the outcomes are of these programs. The HAP Executive Committee, I wouldn't know whether how many city managers and the housing coordinating like Rainie Maher and Elisa.  None of that's open, but they're deciding to close the River Street Camp even though you voted to keep it open. So I propose keeping the River Street Camp open having the city manager go back to the HAP Executive Committee to try to figure out how you can do the funding because you're really only talking about December. In January, we're getting like 10, 11 million dollars. So putting it out to the nonprofits of, hey, who wants to apply for some funding to keep it to use money and then a nonprofit could do the River Street Camp. Another thing that I propose is having more of a discussion with Salvation Army. They're open to using their Laurel Street site too. There was issues with the neighbors and they're willing to do buses the same as they're willing to do buses to VFW. Thank you. Thank you. All right, next speaker please. Keith McHenry, like the library. On Sunday, which was really the third weekend of the month, we had over 209 people come to eat. Many were new faces who are people who are recently displaced. Sadly, many are reporting that landlords are raising their rents dramatically in violation of the rent freeze, but since there's no rent board to stop it, they go willy-nilly forcing people to the streets, including families with children. So next week should be way over 200 on both days if there's any, if history is any indication. At the same time, shutting down the River Street campground and fencing off Lorenzo Park and chasing homeless people out of San Lorenzo Park and telling them they're not allowed to be around there and telling them they have to go across the river and then putting a new fence around the post office and shutting down Grant Street Park. It has the impression to most of the people living on the streets that there's a war by this organization, by the city, by the city manager's office, by city council, by parks and rec against people that are poor. So as a result of the policies here, we know more people will die this year on the streets as a direct result of the actions of the city of Santa Cruz. So I'd like to have a couple of minutes of silence here for those who are likely to perish as a result of these policies. And people are certainly invited to come to the memorial services that will be held on Tuesdays out in front. Thank you very much. Next speaker, please. Good evening, city council. As time goes on and I see my tax dollars in action, I cannot seem to shake off that small yet growing feeling of buyer's remorse. We live in a town where rents are similar to that of New York City. I suppose you could say our traffic could be at the same level, but how about on the public transportation service level forefront? With most metro bus routes departing as often as once per hour, we are on the exact same level as Apple Valley, California, a desert rural town of Southern California. Why is our cost of living so high and our transportation so poor? Mission Street is dangerous for pedestrians and bikers, yet we only see Route 3 servicing that corridor once every two hours. Metro CEO, Mr. Clifford was already given a raise after services were cut by 19%. That's just wrong. I challenge everyone to do 19% less work at their job and have the audacity to ask their boss for a raise. I imagine pink slips in their future, but not, of course, for a manuensipality worker. On top of this, I feel baited by the library measured going toward a parking garage. All of this goes to show my tax dollars are being put to poor use. I will keep this all of this in my next time you beg for more money at the ballot. Now all I see these fences going up left and right while the city just got $3.3 million in grants to tackle the issue of homelessness. Thanks for blocking the garbage bins behind the fences and enabling litter bugs at San Lorenzo Park, by the way. If you can't manage your own parks and transportation with what you have already, this is how you can lose support for these items because somehow you were able to do it before and now you can't. What's with it? And I've said it before and I said it again, quit with the moseying. I understand that we've got a sitting duck here and there but enough is enough with deferring the issues that matter to our community. Thank you. Thank you. Next speaker please. Phil Posner, I'm here speaking on behalf of myself and also my son Micah who wanted to be here. Martin Bernal a second ago, Serge was up here at this microphone and he made some good suggestions.  Now maybe you were and I'm wrong. But I want to talk to the city council about your feelings.  We did it because we think there's a lot of people out there and you've been hearing them like that lady who was ignored by seven people who are being ignored. You have power. I assume that you sleep well at night. You know, I think what hurts me the most is I wrote a letter to every one of you and only Chris answered me. I spent 39 days on a penitentiary in Mississippi and you know what? They listened to us and they talked to us. We didn't always like what they said but at least they communicated with us. We've asked you to have some feelings about the suffering of homeless people. No bathrooms open at night, insufficient bathrooms, now a campground closed. Are you listening? Do you care? Do you sleep at night? Will you please at least communicate with us and tell us what you feel about this issue? Thank you. Thank you. Next speaker please. Gerard, last speaker on the side, oral communications.   He's, you know, on one hand, personable and on the other hand just kind of like emotionally unstable and weird and you know, a lot of that goes on in the homeless community. You've got all kinds of problems that are comorbid with homelessness, drug abuse. I wanna say that, I mean, you guys are worried about the wholesale tax on cannabis but I'm more worried about the people who are on the streets who are using drugs and you know, don't have a place to go. What I'd like to see with homelessness in this community is kind of what surge is on the tail of which is just finding solid solutions for people because there are a lot of people out there who have very limited options as time wears on. It seems like every year, I mean, they just raise the rent on me and as time, I mean, measure M, whether it passes or not. I mean, these issues of people being on the streets and being marginalized are gonna be with us for, you know, who knows how long. The economy's been pretty good, unemployment's very low but the stock market's doing something strange but you know, in the long run, we look at our community values and we look at, you know, what, you know, what do we feel, you know, is morally right to do about these issues and the bathroom thing, coming back to the bathroom thing, I mean, I hope you guys can see fit to have the, sorry, Loudon Nelson, sorry, I'm out of time. Loudon Nelson. Thank you. Thank you. Right, that concludes oral communications. No, you've already spoken. The next item on the agenda is item number 14, the accessory dwelling unit, limited deferral of owner occupancy requirements and affordability provisions. So that's number 14 and we have Jessica Mallore and Carol Burk speaking. Thank you. I can make it a quick report. Yeah, yeah, I've already told, yeah. This is a brief report as we discussed. Good afternoon or good evening, mayor and council members, Carol Burk and Jessica Mallore for economic development and you have actually the next two items are related in that they're both dealing with limited deferrals of owner occupancy requirements for single family homeowners that have an ADU on their property and Jessica's done all the work and she's gonna do the presentation, so Jessica. All right, thank you for having me this evening. As Carol mentioned, the first item number 14 is about ADU limited deferral of owner occupancy and adding a affordability provision. So there's two ways to allow for non-owner occupancy and the first way would be temporary and this has been included in the ADU ordinance since 2014. It's both limited deferral program which we're gonna talk about tonight. There's also an ADU legalization program that does have a temporary component for non-owner occupancy and then there's the permanent way to allow for non-owner occupancy and that's currently being researched by the planning department and it's based on housing blueprint subcommittee and council direction to research that non-owner occupancy in exchange for affordability. So just to be very clear, tonight we were talking about a temporary aspect for non-owner occupancy and this is related to council action you took in August requesting this affordability. So the history of the proposed resolution November, 2014 was when the first resolution establishing the limited deferral of owner occupancy program was passed by the council and then again on August 28th, the city council made the motion to direct staff to ask to provide affordability requirements. So our new resolution while mostly unchanged, there is a new aspect of affordability and that is just for the term of the limited deferral period. So it's two years as approved by council with an optional one-year extension by the planning and community development director. So the proposed affordability requirements in the resolution are for 60% of area median income or for section eight voucher holder and this is different from the inclusionary ordinance which was originally referenced in the motion which would be at 80% of area median income and so the reason staff is proposing 60% is that it's consistent with the AD legalization program and so it would be consistent at a level of affordability and then we wanted to highlight that while we're not adding the professional management company requirement, it is still being maintained in the new resolution. So any property owner who has a limited deferral must retain a management company to manage both the main house and the ADU during that period and then brand new is the income and rent calculator and exhibit B of the resolution and that is just explaining how we calculate the 60% AMI for both income and rents and then finally, this is the staff recommendation of action to be taken for this item. So any questions? Are there any, I'm going to go to the public first to see if there's any members of the public that would like to speak to this item. Please step on up. Is there any other member of the public that would like to speak to this item? Okay, go right ahead, sir. Yes, hello, I'm Patrick Thomas. I'm actually the owner of a ADU parcel. I was just, so this will be actually directly affecting me. I'm the follow-up. Okay, so you're speaking to this item. This is a different item. Exactly. Okay. So speaking from this sort of situation, I could definitely agree with the affordability requirement if it's a permanent change, but as a temporary change, it essentially nullifies the owner occupancy deferral originally written and added to the ordinance in 2014 because essentially the idea is that if somebody had to maybe move out of town for work or some other sort of obligation that they would leave and they would have two years with possible one-time extension and then they could return. So if it becomes an affordability requirement, you would therefore be asking somebody, the owner to basically be offering subsidized housing for someone for a short-term time. So if they were to return, you would know exactly which tenant would get a notice. So it's essentially a short-term solution, affordable housing solution, and it would make it so that somebody if they had to leave would seriously consider either selling the house or trying to do something maybe without going through the city essentially under the table sort of situation because the majority of people are gonna be living in the original house and the ADU would be most likely the rental tenant unit and so then they would be leaving the original house which would have to be, in my case, it's a two-bedroom one-bath. I think I've seen the numbers would be renting for about $1,000 a month and the application is $3,000. I don't see anyone that would write a check for $3,000 for permission to rent their house for $1,000 a month. Thank you. Is there any other member of the public that wishes to speak to this item? Seeing none, I'm gonna bring it back to the council for discussion and this item came forward on the August 28th, 2018 meeting and I watched the video, the discussion and I just wanna state before we have this discussion I really strongly believe in the owner occupancy requirement for these and when we first made the direction on the council back in November, 2014 it was really under emergency circumstances like to have these so when someone has a death in the family or there's someone that's forced to relocate or there's some other impact based on their ability to reside in the house it provided some flexibility so that one they could keep their house until there was a decision made and I feel that this is kind of a slippery slope in terms of like how we're starting to maybe take this ordinance and reapply it in different ways. I mean, one thing that I would say is if someone after three years is unable to figure out what their position is in the home they might, we might have a requirement that states that they have to sell it or there's gotta be something maybe it's sold to someone who lives locally or give first right refusal to someone who's currently residing in the property because I think we have an obligation to look at all types of housing options and one of the things I don't wanna see is is turn over our residential housing stock to create everything into a rental unit and so for me, I wasn't there for the discussion on the 28th, I think council member Cron voted against it at that time but I think it's something where I feel like I don't like this is being looking at bootstrapping another one for longer term housing and looking at grafting it onto this more temporary measure. So I just wanna say that on the outset. So is there any further discussion on this particular? Can I just clarify? This is not extending the period that the unit would be vacated. I mean that the owner would have the temporary period they would have two years with chance of a one year extension and the timeline is no different than what's on the books now. This is only dealing with whether one of the units would be rented at an affordable rent. I understand. Council member Cron. What's the criteria for the circumstances that somebody would qua