Morgan Hill

City Council Staff Report

Proposition 64 (Marijuana) Update


Department:Police DepartmentSponsors:



Should the City consider allowing marijuana manufacturing, cultivation, retail sales, and/or delivery services?



On February 1, 2017, Council held a workshop on recreational marijuana.  At a subsequent meeting on February 15, 2017, Council directed staff to update the municipal code to ensure agreement with Proposition 64 – a proposition approved by California voters in 2016 to legalize the recreational use of marijuana.  The purpose of this report is to clarify the municipal code and to continue the conversation related to allowed uses of recreational marijuana as it relates to manufacturing, cultivation, retail sales, and/or delivery. 


The proposed changes to the municipal code entail removing any reference to “medical marijuana, to clarify that the existing marijuana restrictions apply to both medical and recreational marijuana sales, cultivation, and distribution.  The proposed revised ordinance (attached) also reflects the change in state law to allow indoor cultivation of up to six marijuana plants for personal use.


Since the passage of Proposition 64 several individuals have approached staff inquiring about the feasibility and/or potential manufacturing, cultivation, or retail sales business opportunities. Staff recommends that further analysis and research be completed to better understand the potential community impacts – including youth access and impaired driving – and the realities of the impacts without the associated revenue to help address them. To learn more about the recreational marijuana industry, its community impacts, and potential new City revenue, staff contacted HdL Companies (HdL).  HdL presently provides counsel to approximately 70 cities throughout California on best practices for marijuana regulation and expectations for potential revenue and impacts. Staff is seeking direction on future uses and recommends another workshop on recreational marijuana facilitated by HdL companies to assist the City Council and community.


To help frame the workshop content, staff desires to compile a list of questions Council would like answered.  It is understood that the list of questions is not expected to be final and additional questions will surface during the workshop.  Questions from the Council’s discussion will start the conversation for a workshop to be scheduled in September.



The future workshop will involve the community and staff will encourage participation in the conversation surrounding recreational marijuana.



1.     Council could choose to not hold a workshop and ask staff to return with a revised ordinance that allows production, cultivation, and/or retail sales.

2.     Council could choose to not hold a workshop and ask staff to leave the proposed ordinance in place, which explicitly prohibits all marijuana related uses except those allowed by Proposition 64.

3.     Council could appropriate funding to engage the community through a statistically valid survey to gauge the community’s interest in various aspects of recreational marijuana.



On February 1, 2017, Council held a workshop on recreational marijuana to discuss Proposition 64 and related policies.  The workshop was for information and discussion only. On May 25, 2011 Council approved an ordinance which prohibited medical marijuana distribution facilities within Morgan Hill. On July 20, 2011 Council approved a resolution in support of the Cities Association of Santa Clara County’s request for consistent federal and state regulation of medicinal marijuana.



The recommended actions have no fiscal impact. The time to prepare this staff report and updated ordinance are part of existing staffing resources.



The proposed ordinance is not a project for CEQA purposes because it maintains the status quo, and it is not reasonably foreseeable that the proposed changes to the City’s marijuana ordinance will have a direct or indirect impact on the environment.

Meeting History

Jul 19, 2017 5:15 PM Video City Council Special - Regular Meeting
draft Draft

Police Chief David Swing presented the report.

The public comment was opened at 8:49 p.m. The following people were called to speak.

Joy Joyner

Doug Muirhead

Brian Faircloth

Mike Robinson

There being no further requests to speak, the public comment was closed.


Waiving the first and second reading of the ordinance.

MOVER:Rich Constantine, Council Member
SECONDER:Larry Carr, Mayor Pro Tem
AYES:Steve Tate, Larry Carr, Rich Constantine, Caitlin Jachimowicz
NAYS:Rene Spring