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Item No. 16 PA 2018-36 Cannabis Kingdom, LLC CUP Cannabis Facility
City Council Agenda Report City of Lake Elsinore 130 South Main Street Lake Elsinore, CA 92530 www.lake-elsinore.org File Number: ID# 19-716 Agenda Date: 8/25/2020 Status: Approval FinalVersion: 1 File Type: Council Public Hearing In Control: City Council / Successor Agency Agenda Number: 16) Planning Application 2018 36 (Cannabis Kingdom): A request by Cannabis Kingdom, LLC to modify a previously-approved Conditional Use Permit to establish an 8,099 SF cannabis facility with ancillary functions located within an existing building (Project) 1.Adopt A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, APPROVING MODIFICATIONS TO CONDITIONAL USE PERMIT NO. 2018-05 TO INCREASE THE TOTAL AREA FROM 5,602 SF TO AN APPROXIMATELY 8,099 SQUARE FOOT CANNABIS FACILITY WITHIN AN EXISTING BUILDING LOCATED AT 31875 CORYDON UNIT 120 AND 31881 CORYDON UNIT 160 (APN:370-051-008 AND 031); and 2.Introduce by title only and waive further reading of AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, APPROVING MODIFICATIONS TO DEVELOPMENT AGREEMENT NO. 2018-04 TO INCREASE THE TOTAL AREA FROM 5,602 SF TO AN APPROXIMATELY 8,099 SQUARE FOOT CANNABIS FACILITY WITHIN AN EXISTING BUILDING LOCATED AT 31875 CORYDON UNIT 120 AND 31881 CORYDON UNIT 160 (APN:370- 051-008 AND 031). Page 1 City of Lake Elsinore Printed on 8/20/2020 REPORT TO CITY COUNCIL To: Honorable Mayor and Members of the City Council From: Grant Yates, City Manager Prepared By: Justin Kirk Date: August 25, 2020 Subject: Planning Application 2018-36 (Cannabis Kingdom): A request by Cannabis Kingdom, LLC to modify a previously approved Conditional Use Permit to establish an 8,099 SF cannabis facility with ancillary functions located within an existing building (Project). Applicants: Cannabis Kingdom, LLC Recommendation ADOPT, A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, APPROVING MODIFICATIONS CONDITIONAL USE PERMIT NO. 2018-05 TO INCREASE THE TOTAL AREA FROM 5,602 SF TO AN APPROXIMATELY 8,099 SQUARE FOOT CANNABIS FACILITY WITHIN AN EXISTING BUILDING LOCATED AT 31875 CORYDON UNIT 120 AND 31881 CORYDON UNIT 160 (APN:370-051-008 AND 031); AND, Introduce by title only and waive further reading of an ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, APPROVING MODIFICATIONS TO DEVELOPMENT AGREEMENT NO. 2018-04 TO INCREASE THE TOTAL AREA FROM 5,602 SF TO AN APPROXIMATELY 8,099 SQUARE FOOT CANNABIS FACILITY WITHIN AN EXISTING BUILDING LOCATED AT 31875 CORYDON UNIT 120 AND 31881 CORYDON UNIT 160 (APN:370-051-008 AND 031). Background In December of 2018, the City Council approved a Development Agreement with Veteran Organic Solutions and a Conditional Use Permit to operate a cannabis facility. On August 18, 2020, the Planning Commission unanimously took action to recommend approval of both the modifications to the Development Agreement as well as the Conditional Use Permit. Discussion The proposed project would modify an existing Development and Conditional Use Permit approved to establish a 5,602 SF cannabis facility within 31875 Corydon Unit 120 by adding 2,497 SF of space in 31881 Corydon Unit 160. Both suites are located within an existing building (Project) and the combined area is 8,099 SF and uses consists of: Office/Administrative: 541sf Shipping/Receiving: 328sf PA 2019-36 Cannabis Kingdom August 25, 2020 Page 2 of 3 Dispensary: 1,506sf Manufacturing Rooms: 1,793sf Distribution: 570sf Electrical/ Storage Closets/ Hallways/ Restrooms/ Entry Room: 3,066sf. Secure Storage. o Retail: 63sf o Manufacturing: 134sf o Distribution: 98sf The Project is generally located at the northeast corner of the intersection Cereal and Corydon and more specifically referred to as 31875 Corydon Unit 120 and 31881 Corydon Unit 160 (APNs:370-051-008 and 370-051-031). The subject site is zoned M1. Analysis General Plan Consistency The subject site has a General Plan Land Use Designation of Limited Industrial (LI) and is in the Business District. The focus of the Business District is to support its position as the industrial and commercial hub of the City. Specific Goals of the Business District applicable to this project include: To encourage its position as the industrial and commercial hub of the City and to ensure that new growth respects the environmental sensitivity of the natural wetlands, floodway, and floodplain. Support a vibrant commercial and industrial hub with high-quality developments that have a strong orientation towards major corridors. Provide a safe and comprehensive roadway network for vehicular, truck, bicycle, and pedestrian traffic throughout the Business District. The LI designation provides for industrial parks, warehouses, manufacturing, research and development, public and quasi-public uses, and similar and compatible uses. The subject use includes a variety of manufacturing, distribution, and warehousing uses to produce cannabis products. The proposed facility is wholly located within existing buildings and does not propose or can have exterior operations. The proposed cannabis facility furthers the goals of the Business district by reinforcing the viability of the industrial hubs and will help to create vibrant industrial hubs by introducing additional business in existing developments that create high paying jobs, reduced vacancy rates, and increased investment in the existing industrial parks. Overall, the proposed cannabis facility introduces new land uses to an existing mix of industrial and quasi-commercial uses. The proposed facility has been previously identified as furthering the goals of the Business District and not creating new unmitigated significant impacts; because of this, they are found to be consistent with the General Plan. Municipal Code Consistency The subject site has a base zoning designation M-1 Limited Manufacturing District. The proposed cannabis facility is located wholly within existing an industrial park, which has been previously analyzed for consistency with the base district development standards and other criteria and was found to be consistent with the applicable base zoning designations. A review of the current operational characteristics did not reveal any code violations and the building is following the base PA 2019-36 Cannabis Kingdom August 25, 2020 Page 3 of 3 district regulations as well. Chapter 17.156 of the Lake Elsinore Municipal Code specifically regulate cannabis-related uses. The proposed cannabis facility has been analyzed for consistency with these operational requirements and the proposed facility has been found to meet these requirements. In addition to the code requirements, additional detail information was specified in the application materials: Fire protection plan Closure plan, i.e., a plan to fully restore the occupied space to the condition that existed before the establishment of a cannabis-related facility and the posting of a bond so that the City could authorize the work without incurring financial liability Information related to project proponents Project-specific details as to the operational characteristics identifying the number of employees, production quantities and values, and other pertinent information. These additional details were required to ensure that the proposed facility operates safely and would not create unintended impacts during the construction, operation, and closure of these facilities. Staff has reviewed these additional details and have found that the materials submitted demonstrate that the proposed cannabis facility would operate in a manner that would not adversely impact the adjacent business in operation. Because the proposed cannabis facility meets the minimum code requirements and does not propose any adverse impacts on adjacent businesses, they have been found consistent with the Municipal Code. Also, Conditions of Approval have been prepared that require the facility to operate in a safe and non-impactful manner. Environmental Determination The proposed Project is exempt from the California Environmental Quality Act (Cal. Pub. Res. Code §§21000 et seq.: “CEQA”) and the CEQA Guidelines (14 C.C.R. §§ 15000 et seq.) according to CEQA Guidelines Section 15301 (Class 1: Existing Facility) (a) Interior or exterior alterations involving such things as interior partitions, plumbing, and electrical conveyances: The project is located within an existing building. The proposed project does not propose an intensification of use that would require the preparation of a Traffic Impact Analysis since the proposed use generates less than 100 trips. The proposed project does not create an expansion or intensification of use beyond what was previously analyzed as a part of the original project’s environmental assessment. Exhibits A – PA 2019-36 CUP Resolution B – PA 2019-36 DA Ordinance C – PA 2019-36 Conditions of Approval D – PA 2019-36 Vicinity Map E – PA 2019-36 Aerial Map F – PA 2019-36 Development Agreement G – PA 2019-36 Project Plans ORDINANCE NO. 2020- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, APPROVING MODIFICATIONS TO DEVELOPMENT AGREEMENT NO. 2018-04 TO INCREASE THE TOTAL AREA FROM 5,602 SF TO AN APPROXIMATELY 8,099 SQUARE FOOT CANNABIS FACILITY WITHIN AN EXISTING BUILDING LOCATED AT 31875 CORYDON UNIT 120 AND 31881 CORYDON UNIT 160 (APN:370- 051-008 AND 031) Whereas, Cannabis Kingdom, LLC has filed an application with the City of Lake Elsinore (City) requesting approval of Planning Application No. 2018-36 for modifications to Development Agreement No. 2018-02 (Exhibit A) and Conditional Use Permit No. 2018-06 to establish an 5,602 Square Foot (SF) Cannabis Facility within an existing building (Project). The modified Project will increase the size 2,497 for a total Area of 8,099 SF. The Project is generally located at the northeast corner of the intersection Cereal and Corydon and more specifically referred to as 31875 Corydon Unit 120 and 31881 Corydon Unit 160 (APN:370-031-008 and -031); and, Whereas, Section 6.0 of the Western Riverside County Multiple Species Habitat Conservation Plan (MSHCP) requires that all discretionary projects within a MSHCP Criteria Cell undergo the Lake Elsinore Acquisition Process (LEAP) and Joint Project Review (JPR) to analyze the scope of the proposed development and establish a building envelope that is consistent with the MSHCP criteria; and, Whereas, Section 6.0 of the MSHCP further requires that the City adopt consistency findings demonstrating that the proposed discretionary entitlement complies with the MSHCP Criteria Cell, and the MSHCP goals and objectives; and, Whereas, pursuant to Chapter 19.12 (Development Agreements) of the Lake Elsinore Municipal Code (LEMC) the Planning Commission (Commission) has been delegated with the responsibility of reviewing and making a recommendation to the City Council (Council) whether the development agreement is consistent with the City’s General Plan and whether to approve the development agreement; and, Whereas, on August 18, 2020, at a duly noticed Public Hearing, the Commission considered evidence presented by the Community Development Department and other interested parties with respect to this item and acted to recommend approval of the subject modifications to the Council; and, Whereas, pursuant to Chapter 19.12 (Development Agreements), the Council has the responsibility of making decisions to approve, conditionally approve, or disapprove recommendations of the Commission for Development Agreements; and, Whereas, on August 25, 2020, at a duly noticed Public Hearing, the Council has considered the recommendation of the Commission as well as evidence presented by the Community Development Department and other interested parties with respect to this item. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE DOES ORDAIN AS FOLLOWS: Section 1: That in accordance with the MSHCP, the Council makes the following findings for MSHCP consistency: ORD. No. 2020-____ Page 2 of 5 1. The Project is not subject to the City’s LEAP and the Western Riverside County Regional Conservation Authority’s (RCA) JPR processes as it is not located within a Criteria Cell. 2. The Project is consistent with the Riparian/Riverine Areas, Vernal Pools Guidelines, and the Fuel Management Guidelines as the Project is wholly located within an existing building and does not include any earth disturbing activities therefore Sections 6.1.2 or 6.3.1 of the MSHCP are not applicable. 3. The Project is consistent with the Protection of Narrow Endemic Plant Species Guidelines and the Additional Survey Needs and Procedures because the project is not located within any Narrow Endemic Plant Species Survey Areas or Critical Species Survey Areas. 4. The Project is consistent with the Fuels Management Guidelines because the Project site is not within or adjacent to any MSHCP Criteria Cell or conservation areas. 5. The Project has been conditioned to pay any applicable MSHCP Local Development Mitigation fees. Section 2: The Council hereby finds and determines that the Project is categorically exempt from California Environmental Quality Act (Cal. Publ. Res. Code §§21000 et seq. “CEQA”) and CEQA Guidelines (14. Cal. Code Regs. §§15000 et seq.), specifically pursuant to Section 15301 (Class 1 – Existing Facilities), because the Project proposes to establish a Cannabis Facility within an existing building. The site is fully developed, and only minor interior alterations are planned in association with the proposed use. Section 3: That in accordance with California Planning and Zoning Law and the Section 19.12.070 (Council report) of the LEMC, the Council makes the following findings regarding modifications to Development Agreement No. 2018-04: 1. It is consistent with the objectives, policies, general land uses and programs specified in the General Plan and any applicable specific plan. The proposed Development Agreement will help to offset the potential costs incurred by the City associated with the establishment of a Cannabis related facility within an industrial district. The Project site’s General Plan Land Use designation is Limited Industrial (LI). The proposed Project is consistent the LI land use designation and with the objectives, policies, general land uses and programs specified in the General Plan. 2. It is compatible with the uses authorized in, and the regulations prescribed for, the land use district in which the real property is located. The proposed Development Agreement will facilitate the establishment of the Cannabis related facility within an existing building. The Project is located in the Limited Industrial (LI) General Plan Land use designation and the Limited Manufacturing (M-1) Zoning designation, which is consistent with the applicable General Plan Land Use Designation. The proposed use is a permitted use subject to the approval of a Conditional Use Permit within the M-1 Zoning designation. 3. It is in conformity with public convenience, general welfare and good land use practices. ORD. No. 2020-____ Page 3 of 5 The proposed Cannabis related facility which will be facilitated through the proposed Development Agreement was found to be a high value development which will have beneficial impacts to the surrounding community. Furthermore, the Project has been reviewed and conditioned by all applicable City departments to reduce the potential for any adverse effects. 4. It will not be detrimental to the health, safety and general welfare. The proposed Development Agreement will facilitate the establishment of a Cannabis related facility within an existing building. The proposed Project has been reviewed and conditioned by all applicable City departments to reduce the potential for any adverse effects to the health, safety and general welfare. 5. It will not adversely affect the orderly development of property or the preservation of property values; The proposed Development Agreement will facilitate the establishment of a Cannabis related facility within an existing building. The proposed use has been analyzed and staff has determined that the proposed use meets all applicable sections of the LEMC and will complement the existing uses. The Project was found not to adversely affect the orderly development of property or the preservation of property values. 6. It is consistent with the provisions of Government Code Sections 65864 through 65869.5. The proposed Development Agreement includes all mandatory provisions required by Government Code § 65865.2 and does not include any provisions that are not authorized by the Development Agreement Act. Section 4: Based upon the evidence presented, both written and testimonial, and the above findings, the Council finds that the Project is consistent with the MSHCP. Section 5: Based upon the evidence presented, the above findings, and the Conditions of Approval imposed upon the Project, the Council hereby approves the proposed modifications to Development Agreement No. 2018-04. Section 6. If any provision of this Ordinance or its application is held invalid by a court of competent jurisdiction, such invalidity shall not affect other provisions, sections, or applications of the Resolution which can be given effect without the invalid provision or application, and to this end each phrase, section, sentence, or word is declared to be severable. Section 7. This Ordinance shall take effect thirty (30) days after the date of its final passage or such later date as may be designated by the City Council. The City Clerk shall certify as to adoption of this Ordinance and cause this Ordinance to be published and posted in the manner required by law. PASSED and ADOPTED at the Regular meeting of the City Council of the City of Lake Elsinore, California, on the __th day of __________________ 2020. Brian Tisdale, Mayor ORD. No. 2020-____ Page 4 of 5 Attest: ___________________________________ Candice Alvarez, MMC City Clerk STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF LAKE ELSINORE ) I, Candice Alvarez, MMC, City Clerk of the City of Lake Elsinore, California, do hereby certify that the foregoing Ordinance No. 2020-____ was introduced at the Regular meeting of August 25, 2020, and adopted by the City Council of the City of Lake Elsinore at its Regular meeting of ______________, 2020 by the following vote:: AYES: NOES: ABSENT: ABSTAIN: Candice Alvarez, MMC City Clerk ORD. No. 2020-____ Page 5 of 5 Exhibit A RESOLUTION NO. 2020- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, APPROVING MODIFICATIONS TO CONDITIONAL USE PERMIT NO. 2018-05 TO INCREASE THE TOTAL AREA FROM 5,602 SF TO AN APPROXIMATELY 8,099 SQUARE FOOT CANNABIS FACILITY WITHIN AN EXISTING BUILDING LOCATED AT 31875 CORYDON UNIT 120 AND 31881 CORYDON UNIT 160 (APN:370- 051-008 AND 031) Whereas, Cannabis Kingdom, LLC has filed an application with the City of Lake Elsinore (City) requesting approval of Planning Application No. 2018-36 for modifications to Development Agreement No. 2018-02 (Exhibit A) and Conditional Use Permit No. 2018-06 to establish an 5,602 Square Foot (SF) Cannabis Facility within an existing building (Project). The modified Project will increase the size 2,497 for a total area of 8,099 SF. The Project is generally located at the northeast corner of the intersection Cereal and Corydon and more specifically referred to as 31875 Corydon Unit 120 and 31881 Corydon Unit 160 (APN:370-031-008 and 370-031-031); and, Whereas, Section 6.0 of the Western Riverside County Multiple Species Habitat Conservation Plan (MSHCP) requires that all discretionary projects within a MSHCP Criter ia Cell undergo the Lake Elsinore Acquisition Process (LEAP) and Joint Project Review (JPR) to analyze the scope of the proposed development and establish a building envelope that is consistent with the MSHCP criteria; and, Whereas, Section 6.0 of the MSHCP further requires that the City adopt consistency findings demonstrating that the proposed discretionary entitlement complies with the MSHCP Criteria Cell, and the MSHCP goals and objectives; and, Whereas, Chapter 17.168 of the Lake Elsinore Municipal Code (LEMC) provides that certain uses have operational characteristics that, depending on the location and design of the use, may have the potential to negatively impact adjoining properties, businesses or residents and therefore are permitted subject to the issuance of a Conditional Use Permit, which allows the City to comprehensively review and approve the use; and, Whereas, pursuant to Chapter 17.168 (Conditional Use Permits) of the LEMC, the Planning Commission (Commission) has been delegated with the responsibility of making recommendations to the City Council (Council) pertaining to conditional use permits; and, Whereas, on August 18, 2020, at a duly noticed Public Hearing, the Commission considered evidence presented by the Community Development Department and other interested parties with respect to this item and acted to recommend approval of the modifications to the Conditional Use Permit, and, Whereas, pursuant to Chapter 17.168 (Conditional Use Permits), the Council has the responsibility of making decisions to approve, conditionally approve, or disapprove recommendations of the Commission for Conditional Use Permits; and, Whereas, on August 25, 2020, at a duly noticed Public Hearing, the Council has considered the recommendation of the Commission as well as evidence presented by the Community Development Department and other interested parties with respect to this item. CC Reso. No. 2020-____ Page 2 of 4 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1: The Commission has considered the Project prior to making a recommendation to the Council and has found it acceptable. Section 2: That in accordance with the MSHCP, the Council makes the following findings for MSHCP consistency: 1. The Project is not subject to the City’s LEAP and the Western Riverside County Regional Conservation Authority’s (RCA) JPR processes as it is not located within a Criteria Cell. 2. The Project is consistent with the Riparian/Riverine Areas, Vernal Pools Guidelines, and the Fuel Management Guidelines as the Project is wholly located within an existing building and does not include any earth disturbing activities therefore Sections 6.1.2 or 6.3.1 of the MSHCP are not applicable. 3. The project is consistent with the Protection of Narrow Endemic Plant Species Guidelines and the Additional Survey Needs and Procedures because the project is not located within any Narrow Endemic Plant Species Survey Areas or Critical Species Survey Areas. 4. The Project is consistent with the Fuels Management Guidelines because the Project site is not within or adjacent to any MSHCP Criteria Cell or conservation areas. 5. The project has been conditioned to pay any applicable MSHCP Local Development Mitigation fees. Section 3: The Council hereby finds and determines that the Project is categorically exempt from California Environmental Quality Act (Cal. Publ. Res. Code §§21000 et seq. “CEQA”) and CEQA Guidelines (14. Cal. Code Regs. §§15000 et seq.), specifically pursuant to Section 15301 (Class 1 – Existing Facilities), because the Project proposes to establish a Cannabis Facility within an existing building. The site is fully developed, and only minor interior alterations are planned in association with the proposed use. Section 4: That in accordance with California Planning and Zoning Law and the LEMC Section 17.168.060 (Findings), the Council makes the following findings regarding the Project: 1. That the proposed use, on its own merits and within the context of its setting, is in accord with the objectives of the General Plan and the purpose of the planning district in which the site is located. The proposed Project is located in the Limited Industrial (LI) General Plan Land use designation and the Limited Manufacturing (M-1) Zoning designation, which is consistent with the applicable General Plan Land Use Designation. The proposed use is a permitted use subject to the approval of a Conditional Use Permit within the M-1 Zoning designation. 2. The proposed use will not be detrimental to the general health, safety, comfort or general welfare of persons residing or working within the neighborhood of the proposed use or the City, or injurious to property or improvements in the neighborhood or the City. CC Reso. No. 2020-____ Page 3 of 4 The proposed use will be located within an existing building. The proposed use does not propose either directly or indirectly any detrimental effects to the existing surrounding community. The Project has been conditioned as such to avoid any possible negative impacts associated with the conversion and operation of the proposed facility. 3. The site for the intended use is adequate in size and shape to accommodate the use, and for all the yards, setbacks, walls or fences, landscaping, buffers and other features required by this title. The proposed use has been analyzed and staff has determined that the proposed use meets all applicable sections of the LEMC and will complement the existing uses, based on the submitted plans and attached conditions of approval. 4. The site for the proposed use relates to streets and highways with proper design both as to width and type of pavement to carry the type and quantity of traffic generated by the subject use. The proposed use is located within an existing built environment, inclusive of streets. The existing streets are of adequate size to facilitate safe and convenient transportation to and from the site. 5. In approving the subject use at the specific location, there will be no adverse effect on abutting properties or the permitted and normal use thereof. The Project has been thoroughly reviewed and conditioned by all applicable City departments thereby eliminating the potential for any adverse effects. 6. Adequate conditions and safeguards pursuant to Section 17.168.050 of the LEMC, including guarantees and evidence of compliance with conditions, have been incorporated into the approval of the subject Project to ensure development of the property in accordance with the objectives of this chapter and the planning district in which the site is located. Pursuant to Section 17.168.040 of the LEMC, the Project was considered by the Council at a duly noticed Public Hearing on August 25, 2020, appropriate and applicable conditions of approval have been included to protect the public health, safety and general welfare. Section 5: Based upon the evidence presented, both written and testimonial, and the above findings, the Councils find that the Project is consistent with the MSHCP. Section 6: Based upon the evidence presented, the above findings, and the Conditions of Approval imposed upon the Project, the Council hereby approves Conditional Use Permit No. 2019-09. Section 7: The City Clerk shall certify to the adoption of this Resolution and enter it into the book of original Resolutions. Passed and Adopted on this 25th day of August 2020. CC Reso. No. 2020-____ Page 4 of 4 Brian Tisdale, Mayor Attest: ___________________________________ Candice Alvarez, MMC City Clerk STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF LAKE ELSINORE ) I, Candice Alvarez, MMC, City Clerk of the City of Lake Elsinore, California, do hereby certify that Resolution No. 2020-____ was adopted by the City Council of the City of Lake Elsinore, California, at the regular meeting of August 25, 2020, and that the same was adopted by the following vote: AYES: NOES: ABSENT: ABSTAIN: Candice Alvarez, MMC City Clerk Applicant’s Initials: _____ Page 1 of 12 CONDITIONS OF APPROVAL RESOLUTION: 2020-XX & 2028-XX PROJECT: PA 2018-36/DA 2018-04/CUP 2018-08 PROJECT NAME: Veterans Organic Solutions PROJECT LOCATION: 31875 Corydon Suite 120 and 31881 Corydon Suite 160 APN: 370-051-008 AND 031 APPROVAL DATE: EFFECTIVE DATE: EXPIRATION DATE: General Conditions 1. Planning Application No. 2018-36 (Development Agreement No. 2018-04 and Conditional Use Permit No. 2018-08) proposes to establish an approximately 8,099 proposed and uses consists of: Office/Administrative: 541sf Shipping/Receiving: 328sf Dispensary: 1,506sf Other (Please Describe) Manufacturing Rooms: 1, 793sf Distribution: 570sf Electrical/ Storage Closets/ Hallways/ Restrooms/ Entry Room: 3,066sf. Secure Storage. o Retail: 63sf o Manufacturing: 134sf o Distribution: 98sf The Project is generally located at the northeast corner of the intersection Cereal and Corydon and more specifically referred to as 31875 Corydon Suite 120 and 31881 Corydon Suite 160 (APN:370-051-008 and 031). The subject site is zoned M1. 2. Conditional Use Permit No. 2018-08 shall be limited to the floor plan prepared by the applicant and included in the staff report. In the event the applicant proposes to modify the floor plan, the modification shall be subject to review by the Community Development Director. The Community Development Director may approve the modification or refer the matter to the Planning Commission if judged to be substantial. 3. The applicant shall defend (with counsel acceptable to the City), indemnify, and hold harmless the City, its Officials, Officers, Employees, Agents, and its Consultants (Indemnitees) from any claim, action, or proceeding against the Indemnitees to attack, set aside, void, or annul an approval of the City, its advisory agencies, appeal boards, or legislative body concerning approval, implementation and construction of CUP 2018-08 which action is bought within the time period provided f or in California Government Code Sections 65009 and/or 66499.37, and Public Resources Code Section 21167, including the approval, extension or modification of CUP 2018-08 or any of the proceedings, acts or determinations taken, done, or made prior to the decision, or to determine the reasonableness, legality or validity of any condition attached thereto. The Applicant's indemnification is intended to include, but not be limited to, damages, fees and/or costs PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 2 of 12 awarded against or incurred by Indemnitees and costs of suit, claim or litigation, including without limitation attorneys' fees, penalties and other costs, liabilities and expenses incurred by Indemnitees in connection with such proceeding. The City will promptly notify the applicant of any such claim, action, or proceeding against the City. If the project is challenged in court, the City and the applicant shall enter into formal defense and indemnity agreement, consistent with this condition. 4. Within 30 days of Project approval and prior to issuance of any building permits, the applicant shall sign and complete an “Acknowledgement of Conditions,” and shall return the executed original to the Community Development Department for inclusion in the case records. 5. Conditional Use Permit No. 2018-08 shall lapse and become void two years following the date on which the Conditional Use Permit became effective, unless one of the following: (1) prior to the expiration of two years, a building permit related to the conditional use permit is issued and construction commenced and diligently pursued toward completion; or (2) prior to the expiration of two years, the applicant has applied for and has been granted an extension of the design review approval pursuant to subsections (B) and (C) of LEMC Section 17.168.080. Subject to the provisions of LEMC Section 17.168.110, a conditional use permit granted pursuant to the provisions of this section shall run with the land and shall continue to be valid upon a change of ownership of the site or structure, which was the subject of the Conditional Use Permit application. 6. The Conditional Use Permit granted herein shall run with the land and shall continue to be valid upon a change of ownership of the site or structure which was the subject of this approval. An application for modification, expansion or other change in a Conditional Use Permit shall be reviewed according to the provisions of the LEMC, Title 17 in a similar manner as a new application. 7. Suspension of a license issued by the State of California, or by any of its departments or divisions, shall immediately suspend the ability of a cannabis facility to operate within the City, until the State of California, or its respective department or division, reinstates or reissues the State license. Should the State of California, or any of its departments or divisions, revoke or terminate the license of a cannabis facility, such revocation or termination shall also revoke or terminate the ability of a cannabis facility to operate within the City. This CUP will expire and be of no further force and effect if any state issued license remains suspended for a period of 6 months. Documentation of three violations during routine inspections or investigations of complaints shall result in the scheduling of a hearing before the Planning Commission to consider revocation of the Conditional Use Permit. 8. This business operator shall pay all sales, use, business and other applicable taxes, and all license, registration, and other fees and permits required under federal, state and local law. This business operator shall pay all sales, use, business and other applicable taxes, and all license, registration, and other fees and permits required under federal, state and local law. This business operator shall cooperate with the City with respect to any reasonable request to audit the business' books and records for the purpose of verifying compliance with State and Local regulations and this CUP, including but not limited to a verification of the amount of taxes required to be paid during any period and the limitation on gross sales receipts. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 3 of 12 9. The applicant shall pay all applicable City fees, including but not limited to: Development Impact Fees (DIF), Fire Facilities Fees, and Traffic Infrastructure Fees (TIF) per LEMC Section 16.74, Transportation Uniform Mitigation Fees (TUMF) per LEMC Section 16.83, Area Drainage Fees per LEMC Section 16.72, MSHCP Fee per LEMC Section 16.85, Capital Improvement Impact/Mitigation Fees, Stephens Kangaroo Habitat Fee (K-Rat) per LEMC Section 19.04, and Plan Check fees, at the rate in effect at the time of payment. Operational Standards 10. The uses authorized by this Conditional Use Permit must be conducted in accordance with all applicable state and local laws, including, but not limited to compliance with the most current versions of the provisions of the California Code of Regulations that regulate the uses permitted hereby. Any violation thereof shall be a violation of the conditions of this permit and may be cause for revocation of this permit. 11. The applicant shall at all times comply with Chapter 17.176 (Noise Ordinance) of the LEMC. Prior to the issuance of a building permit, documentation demonstrating compliance shall be provided. 12. The applicant shall at all times comply with Chapter 14.08 (Stormwater/Urban Runoff Management and Discharge Control of the LEMC. Prior to the issuance of a building permit, documentation demonstrating compliance shall be provided. 13. Odor control devices and techniques shall be incorporated to ensure that odors from marijuana are not are not detected outside the property, anywhere on adjacent property or public right-of-way, or within any other units located within the same building as the cannabis facility. Building and mechanical permits must be obtained from the Building Division prior to work commencing on any part of the odor control system. 14. Air quality control devices and techniques shall be incorporated to ensure that the ambient external air quality is not impacted by the cannabis facility. Building and mechanical permits must be obtained from the Building Division prior to work commencing on any part of the air quality control system. Prior to the Building Division issuing a building permit contact the South Coast Air Quality Management District (AQMD) located at: 21865 Copley Dr. Diamond Bar, CA 91765-4178, Tel: 909- 396-2000. A building permit shall not issued until an Identification Number is provided by AQMD and any applicable permits have been issued. 15. Applicant shall contact the Elsinore Valley Municipal Water District (the local water and sewer purveyor) and submit an application and plans for project review. Applicant must obtain approval of all plans prior to the issuance of a building permit and a letter of project completion by the District prior to the issuance of a Certificate of Occupancy. Any Cannabis facility shall meet the minimum requirements of the district and not discharge any material into a sewer system without first obtaining approval. 16. No outdoor storage, cultivation, manufacturing or any other form of use of cannabis or cannabis products, byproducts or waste are permitted at any time. 17. The sale, dispensing, or consumption of alcoholic beverages on or about the premises is prohibited. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 4 of 12 18. The consumption of any cannabis or cannabis product in any form is prohibited from occurring onsite. 19. The owner/operator shall prohibit loitering by persons outside the facility both on the premises and within fifty feet (50') of the premises. 20. Persons under the age of twenty-one (21) years shall not be allowed on the premises of this business. It shall be unlawful and a violation of this CUP for the owner/operator to employ any person who is not at least twenty-one (21) years of age. 21. There shall be no loitering in or around the business. 22. The operator shall maintain free of litter all areas of the premises under which applicant has control. 23. No cannabis or cannabis products, or graphics depicting cannabis or cannabis products, shall be visible from the exterior of this property, or on any of the vehicles owned or used as part of the cannabis business. 24. Cannabis liquid or solid waste must be made unusable and unrecognizable before leaving a secured storage area and shall be disposed of at facility approved to receive such waste. 25. Extraction and post-processing winterization operations shall be conducted according to the approved Registered Design Professional's technical report; approved Fire Protection Plan; and the approved building construction plans. Any change in equipment, operation, or hazard shall be submitted to the City for review and approval before the change taking place. 26. The storage, use, and disposal of volatiles, solvents, or hazardous materials at this facility shall be conducted according to the 2016 California Fire Code and the Riverside County Environmental Health Department regulations. 27. All cannabis and cannabis products sold, distributed or manufactured shall be cultivated, manufactured, and transported by licensed facilities that maintain operations in full conformance with State and local regulations. 28. Cannabis Facility Site Restricted. No cannabis permittee shall open their cultivation site to the public. No cannabis permittee shall allow anyone on the cultivation site, except for managers, staff, and other persons with a bona fide business or regulatory purpose for being there, such as contractors, inspectors, and cannabis transporters. A manager must be onsite at all times that, any other person, except for security guards, is on the site. While onsite, managers and staff of the cannabis cultivation permittee must wear their identification badge at all times. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 5 of 12 Any person other than managers or staff who are on the cultivation site must sign in, wear a visitor badge, and be escorted on the site by a manager at all times. 29. The use shall be conducted, at all times, in a manner that will allow the quiet enjoyment of the surrounding neighborhood. The operator shall institute whatever security and operational measures are necessary to comply with this requirement. 30. If operation of this use triggers concerns related to parking, noise, traffic, or other impacts, at the discretion of the Community Development Director, this Conditional Use Permit may be referred back to the Planning Commission for subsequent review at a Public Hearing. If necessary, the Commission may modify or add conditions of approval to mitigate such impacts, or may revoke said Conditional Use Permit. Site Security Plans 31. Each cannabis facility shall have a security plan approved by the City prior to the issuance of a Cannabis Business Permit. The security plan shall be a narrative and also an include a detailed security plan delineating the physical location of the specific equipment. The proposed security plan must include the following at a minimum: Summary of the security plan, this shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. Security surveillance cameras. Security surveillance cameras and a video recording system must be installed to monitor all doors into the buildings on the site, the parking lot, loading areas, and all exterior sides of the property adjacent to the public rights of way. The cameras and recording system must be of adequate quality, color rendition, and resolution to allow the identification of any individual present on the site. The recording system must be capable of exporting the recorded video in standard MPEG formats to another common medium, such as a DVD or USB drive. Security video recording and retention. Video from the security surveillance cameras must be recording at all times (24 hours a day, seven days a week) and the recording shall be maintained for at least 30 days. The video recordings shall be made available to the City upon request. Location of security cameras and the areas to be covered by the security cameras. Location of audible interior and exterior alarms. Location of exterior lighting. Name and contact information of Security Company. Entrances to all dispensing and cultivation areas will be locked and under control of staff at all times. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 6 of 12 Name of security guard and proof that security guard is licensed by the California Department of Consumer Affairs and whether security guard will be present at the cannabis facility during all hours of operation. If the security guard is to be armed, proof that security guard possesses a valid Security Guard Card and Firearms Permit issued by the California Department of Consumer Affairs. Alarm system. Professionally and centrally-monitored fire, robbery, and burglar alarm systems must be installed and maintained in good working condition. The alarm system must include a private security company that is required to respond to every alarm. 32. Any modifications to the approved security plan shall be reviewed and approved prior to the modifications being implemented. 33. Site security plans requirements may change at the sole discretion of the City. Any changes of requirements imposed by the City shall be complied at minimum during the annual inspection process or sooner as required by the City. 34. In the event any discrepancies between local and state regulations exist, the more restrictive requirements shall prevail. Fire Protection Plan 35. Each cannabis facility shall have fire protection plan approved by the Fire Marshal prior to the issuance of a Cannabis Business Permit. The fire protection plan shall be a narrative and also include a detailed fire protection plan delineating the physical location of the specific equipment. The proposed fire protection plan must include the following at a minimum: Summary of the fire protection plan, this shall be included in the project description, all other elements shall be incorporated as a separate attachment, entitled security plan, to the project description. Occupancy Classification. The Use and Occupancy Classification of Marijuana Business. Please identify the proposed use and occupancy classification of the proposed use. Use and occupancy classifications may be found in Chapter 3 of the California Building Code (CBC), and California Fire Code (CFC). Hazard Communication. When storing or using any type of hazardous materials, CFC Section 407 should be followed and the appropriate paperwork made accessible to the fire code official. Additionally the CFC should be consulted. The CFC gives responders the information of the hazardous chemicals that is on the property. o Material Safety Data Sheets (MSDS) shall be on property and made easily accessible. o Containers and/or packages related to hazardous materials shall be properly labeled and warning signage shall be properly displayed and easily visible. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 7 of 12 o All persons shall be trained on what to do in the event of an emergency involving hazardous material on the property. Fire protection plans shall refer to the location of all hazard communication information. Interior Finishes. It is common in marijuana grow facilities to use a Visqueen® or Mylar® type plastic/polyethylene or polyester sheeting to cover walls and ceilings. Any use of plastic to enclose rooms or cover walls and/or ceilings must be installed in accordance with building and fire code requirements. Interior finishes must comply with flame spread ratings in accordance with Table 803.3 of the CFC. (Note: Hanging plastic from ceilings or suspended overhead structures to create wall dividers is typically NOT compliant with code provisions for a wall partition or interior finish.) Exits and Exit Signage, Egress Security measures are often extreme in cannabis facilities. The desire for security in no way overrides the minimum requirements for exiting and egress. Common issues associated with exits and egresses are as follows: Number of exits shall be in accordance with the CFC. Fire protection plan shall identify o Means of egress cannot be concealed in any way. o Exit doors and their function (these cannot be eliminated without prior approval). o Where 2 or more exits are required, egress doors are required to swing in the direction of egress travel. o Where more than one exit is required, illuminated exit signs are to be provided that must be readily visible from any direction of egress travel. o Intermediary exit signs may also be required per Section 1013 of the CFC. o H occupancies require specific considerations for exiting. Locks and Key Box Where security and life safety objectives conflict, alternative measures may be required or permitted by the City. SECURITY GATES – Due to the increased security measures typically required, and the potential hazards associated with marijuana facilities, the City is authorized to require that any security gate be installed across a fire apparatus road first be approved before installation. o KEY BOXES – Installation of a key box in an approved location, which will permit timely access to the facility in the event of an emergency shall be identified. o LOCKS – The installation of “approved” locks on any and all gates or similar barriers, which will permit timely access to all areas of the facility’s property in the event of an emergency. If the facility has electronic access controls, the City will require an access code or electronic access card be provided. o BOLTS, BARS, LOCKS & LATCHES – Egress doors are required to open easily when exiting without the need for a key, without using extra effort and/or without having special knowledge in order to operate the installed hardware. Door handles, pulls, latches, locks and other operating devices should be free of tight grasping, tight pinching or twisting of the wrist to operate. Slide bolts, security bars, dead bolts, thumb latches and similar hardware items are prohibited from being installed on emergency egress doors. o ALTERNATIVE LOCKING DEVICES - Delayed egress locks and electromagnetic locks are permitted for use in other occupancy types, and must be approved for use by the City. Fire suppression systems. Fire protection plan shall include all suppression systems designed to meet the specific PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 8 of 12 36. Fire prevention plan requirements may change at the sole discretion of the City. Any changes of requirements imposed by the City shall be complied at minimum during the annual inspection process or sooner as required by the City. 37. In the event any discrepancies between local and state regulations exist, the more restrictive requirements shall prevail. Closure Plan 38. Prior to the approval of a Cannabis Business Permit a separate document referred to as a closure plan shall be reviewed and approved. At a minimum the closure plan shall include Remediation Plan. Describe how the cannabis facility will be remediated at end of use. (Process of Removing Equipment, Chemicals, and other items/remnants). A closure cost estimate. Closure costs include the expenses for ceasing operation of the cannabis facility and safely closing the unit and cleaning up any contamination. Post-closure care costs include long-term maintenance of the unit or facility, monitoring, and record keeping during the required post-closure care period. Owner/operators calculate cost estimates based on the cost of paying a third party to perform the required closure and post-closure care activities as outlined in the facility's remediation plan. Cost estimates must be adjusted annually throughout the operational life of the facility to account for inflation. 39. Surety Bond. A surety bond from a surety company shall be submitted and maintained through out the life of the cannabis business permit that all closure and post-closure plan requirements will be fulfilled. If the owner/operator fails to meet the requirements specified in the bond, the surety company is liable for the costs. 40. Closure plan requirements may change at the sole discretion of the City. Any changes of requirements imposed by the City shall be complied at minimum during the annual inspection process or sooner as required by the City. 41. In the event any discrepancies between local and state regulations exist, the more restrictive requirements shall prevail. Insurance 42. The owner/operator shall obtain and maintain at all times during the term of the permit comprehensive general liability insurance and comprehensive automotive liability insurance protecting the permittee in an amount of not less than one million dollars ($1,000,000.00) per occurrence, combined single limit, including bodily injury and property damage and not less than one million dollars ($1,000,000.00) aggregate for each personal injury liability, products-completed operations and each accident, issued by an insurance provider admitted and authorized to do business in California and shall be rated at least A-:viii in A.M. Best & Company's Insurance Guide. Proof of said insurance must be provided to the Planning Division before the business commences operations. Any changes to the insurance policy must be submitted to the Community Improvement Division within 10 days of the date the change is effective. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 9 of 12 Signs 43. Street address shall be visible from the public street and/or shall be displayed on the freestanding sign. If there is no freestanding sign, the street address may be displayed on the fascia adjacent to the main entrance or on another prominent location. W hen the property has alley access, address numerals shall be displayed in a prominent location visible from the alley. Numerals shall be a minimum twelve (12) inches in height with not less than three-fourth-inch stroke and shall contrast sharply with the background. Identification of individual units shall be provided adjacent to the unit entrances. Letters or numerals shall be four (4) inches in height with not less than one-fourth-inch stroke and shall contrast sharply with the background. 44. The following signs in measurements of not less than eight by 10 inches shall be clearly and legibly posted in a conspicuous location inside the cannabis site where they will be visible to members and customers in the normal course of a transaction, stating: Smoking, ingesting or consuming cannabis on this property or within 20 feet of the cannabis facility is prohibited. Drinking, ingesting or consuming alcohol on this property or within 20 feet of the cannabis facility is prohibited. That no person under the age of twenty-one (21) years of age is permitted to enter upon the premises. That loitering by persons outside the facility both on the premises and within fifty feet (50') of the premises is prohibited. Juveniles are prohibited from entering this property unless they are a qualified patient or a primary caregiver and they are in the presence of their parent or legal guardian.” Neither the City of Lake Elsinore, nor any other governmental agency, has tested or inspected any cannabis product for pesticides, or other regulated contaminants, distributed at this location. 45. Business identification signage shall be limited to that needed for identification only. Business identification signage shall not include any references to marijuana or cannabis, whether in words or symbols. All signs shall comply with the Municipal Code. No sign shall be installed until the owner/operator or its designated contractor has obtained any permit required from the City. 46. Signs on the cannabis facility building shall not obstruct the entrance or windows of the distribution facility. Records Retention/Reporting 47. The owner/operator of this cannabis facility shall maintain accurate books and records, detailing all of the revenues and expenses of the business, and all of its assets and liabilities. On no less than an annual basis, or at any time upon reasonable request of the City, the owner/operator shall file a sworn statement detailing the number of sales by the PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 10 of 12 medical marijuana business during the previous twelve month period (or shorter period based upon the timing of the request), provided on a per-month basis. The statement shall also include gross sales for each month, and all applicable taxes paid or due to be paid. 48. The owner/operator shall maintain a current register of the names and the contact information (including the name, address, and telephone number) of anyone owning or holding an interest in the medical marijuana business, and separately of all the officers, managers, employees, agents and volunteers currently employed or otherwise engaged by the cannabis facility. The register required by this condition shall be provided to the City Manager upon a reasonable request. 49. The owner/operator shall maintain an inventory control and reporting system that accurately documents the present location, amounts, and descriptions of all cannabis and cannabis products for all stages of the production or manufacturing, laboratory testing and distribution processes. Subject to any restrictions under the Health Insurance Portability and Accountability Act (HIPPA), the owner/operator shall allow City officials to have access to the business's books, records, accounts, together with any other data or documents relevant to its permitted medical marijuana activities, for the purpose of conducting an audit or examination. Books, records, accounts, and any and all relevant data or documents will be produced no later than twenty-four (24) hours after receipt of the City's request, unless otherwise stipulated by the City. 50. The owner/operator shall have in place a point-of-sale tracking system to track and report on all aspects of the medical marijuana business including, but not limited to, such matters as cannabis tracking, inventory data, and gross sales (by weight and by sale). The owner/operator shall ensure that such information is compatible with the City's record- keeping systems. The system must have the capability to produce historical transactional data for review by the City Manager. Construction Permitting 51. Any internal or external modifications to the building shall require a building permit. 52. No Certificate of Occupancy shall be issued without the issuance of a Cannabis Business Permit and a City Business License. 53. The Applicant shall meet all applicable Building Codes in effect at the time, including but not limited to: 2016 California Building Code, 2016 California Electrical Code, 2016 California Mechanical Code, 2016 California Plumbing Code, 2016 California Green Building Standards Code, and 2016 California Energy Code (or the applicable adopted California Building Code, California Electrical Code, California Mechanical Code, California Plumbing Code, California Green Building Standards, and California Energy Code, at the time of plan submittal or permit issuance) and California Code of Regulations, also known as the California Building Standards Code, as amended by the City. Requirements for accessibility to sites, facilities, buildings, and elements by individuals with disability shall comply with Chapter 11 B of the 2016 California Building Code. 54. The conditions of approval and ordinance or code provisions of planning application PA- 18-06 shall be blueprinted on the face of the site plan as part of the plan check submittal package. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 11 of 12 55. Plans shall be prepared by a California licensed Architect or Engineer Plans shall be wet stamped and signed by the licensed Architect or Engineer prior to the issuance of building permits. 56. The applicant/operator shall comply with all requirements of the Riverside County Fire Department Lake Elsinore Office of the Fire Marshal. 57. Comply with the requirements of the 2016 California Fire Code and referenced standards as amended by the City. Conditional Use Permit Inspections 58. No person having responsibility for the operation of a cannabis business, shall impede, obstruct, interfere with, or otherwise not to allow, the City to conduct an inspection, review or copy records, recordings or other documents required to be maintained by a medical marijuana business under this chapter or under state or local law. It is also unlawful for a person to conceal, destroy, deface, damage, or falsifies any records, recordings or other documents required to be maintained by a cannabis business under state or local law. 59. The City Manager or their designees may enter this business at any time during the hours of operation without notice, and inspect the location of this business as well as any recordings and records required to be maintained pursuant to LEMC or under applicable provisions of State law. The City Manager or his or her designees may conduct inspections at the site, as well as any recordings and records required to be maintained pursuant to the Municipal Code or under applicable provisions of State law. 60. Quarterly Inspections will be conducted by the City to verify compliance with the approved operation. The applicant will pay for the inspection according to the Additional Required Inspections as adopted in the Fee Schedule. Code Enforcement officers, the Building Official and/or the Fire Marshal may enter and inspect the location of this business between the hours of 8:00 am and 5:00 pm Monday through Friday upon 24 hours telephonic notice to the owner or operator, to ensure compliance with this CUP. 61. Annual Fire & Life Safety Inspections will be conducted by the Fire Station Crew for emergency response pre-planning and site access familiarization. The applicant will pay for the inspection according to the adopted Fee Schedule. PA 2018-36/DA 2018-04/CUP 2018-08 PC: August 18, 2020 Conditions of Approval CC: August 25, 2020 Applicant’s Initials: _____ Page 12 of 12 I hereby state that I acknowledge receipt of the approved Conditions of Approval for the above named project and do hereby agree to accept and abide by all Conditions of Approval as approved by the City of Lake Elsinore City Council on ____________. I also acknowledge that all Conditions shall be met as indicated. Date: Applicant’s Signature: Print Name: Address: Phone Number: §¨¦15PA 2018-40DA 2018-08CUP 2018-12PA 2018-33DA 2018-01CUP 2018-05PA 2018-37DA 2018-05CUP 2018-09PA 2018-36DA 2018-04CUP 2018-08I-15 CEREAL STMISSION TRLLEMON STWAITE STCOMO STCORYDON STVINE STALMOND STGRAPE ST BUNDY CANYON RDPALOMAR STLIME STLOQUAT STBEECHER STORANGE STGARDEN STGUFFY LNORCHARD STVICTORIAN LNCANYON DRAPRICOT LNDOROF CTLEWIS STWILDOMAR RDCLOVIS WAYSTONEMAN STWINDTREE AVEBRYANT STBONNIE LNJARO DRMELINDA LNLINDA VISTA LNBERRYWOOD DRJO ANN CTHAGER LNETHEN RDDOROTHY LNANGELS LNVALENCIA STAMBERTON DRCHRISTOPHER LNWAGON RIM CTOLD COACH RDSILVER RUN CIRI-15ORANGE STORCHARD STVINE STVICTORIAN LNCity of Lake ElsinoreEast Lake DistrictCannabis Application Locations´00.150.075 MilesPrepared by:City of Lake Elsinore GISNovember 1, 2018Data Sources:County of Riverside GISCity of Lake Elsinore GISStateplane NAD 83 §¨¦15PA 2018-40DA 2018-08CUP 2018-12PA 2018-33DA 2018-01CUP 2018-05PA 2018-37DA 2018-05CUP 2018-09PA 2018-36DA 2018-04CUP 2018-08I-15 CEREAL STMISSION TRLLEMON STWAITE STCOMO STCORYDON STVINE STALMOND STGRAPE ST BUNDY CANYON RDPALOMAR STLIME STLOQUAT STBEECHER STORANGE STGARDEN STGUFFY LNORCHARD STVICTORIAN LNCANYON DRAPRICOT LNDOROF CTLEWIS STWILDOMAR RDCLOVIS WAYSTONEMAN STWINDTREE AVEBRYANT STBONNIE LNJARO DRMELINDA LNLINDA VISTA LNBERRYWOOD DRJO ANN CTHAGER LNETHEN RDDOROTHY LNANGELS LNVALENCIA STAMBERTON DRCHRISTOPHER LNWAGON RIM CTOLD COACH RDSILVER RUN CIRI-15ORANGE STORCHARD STVINE STVICTORIAN LNSource: Esri, DigitalGlobe, GeoEye, Earthstar Geographics, CNES/Airbus DS, USDA, USGS, AEX, Getmapping, Aerogrid, IGN, IGP, swisstopo, and the GISUser CommunityCity of Lake ElsinoreEast Lake DistrictCannabis Application Locations´00.150.075 MilesPrepared by:City of Lake Elsinore GISNovember 1, 2018Data Sources:County of Riverside GISCity of Lake Elsinore GISStateplane NAD 83 @BCL@780F8489 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Lake Elsinore 130 South Main Street Lake Elsinore, CA 92530 Attn: City Clerk (Space Above Line For Recorder’s Use Only) (Exempt from Recording Fees Per Gov. Code § 27383) DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF LAKE ELSINORE AND VERT LAKE ELSINORE LLC -1- DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF LAKE ELSINORE AND VERT LAKE ELSINORE LLC This Development Agreement (“Agreement”), dated for identification only as of August 1, 2020, is made by and between the City of Lake Elsinore, a California municipal corporation (“City”), and VERT Lake Elsinore LLC, a California limited liability company (“Developer”). This Agreement shall take effect on the “Effective Date,” as this term is hereafter defined. City and Developer may each be referred to herein individually as a “Party” or collectively as the “Parties.” RECITALS A. In 1996, the California Legislature approved Proposition 215, also kno wn as the Compassionate Use Act (“CUA”), which was codified under Health and Safety Code section 11262.5 et sec., and was intended to enable persons in need of medical marijuana for specified medical purposes, such as cancer, anorexia, AIDS, chronic pain, glaucoma and arthritis, to obtain and use marijuana under limited circumstances and where recommended by a physician. The CUA provides that “nothing in this section shall be construed or supersede legislation prohibiting persons from engaging in conduct that endangers others, or to condone the diversion of marijuana for non-medical purposes.” B. In 2004, the California Legislature enacted the Medical Marijuana Program Act (Health & Saf. Code, § 11362.7 et seq.) (“MMP”), which clarified the scope of the CUA, created a state-approved voluntary medical marijuana identification card program, and authorized cities to adopt and enforce rules and regulations consistent with the MMP. Assembly Bill 2650 (2010) and Assembly Bill 1300 (2011) amended the MMP to expressly recognize the authority of counties and cities to “[a]dopt local ordinances that regulate the location, operation, or establishment of a medical marijuana cooperative or collective” and to civilly and criminally enforce such ordinances. C. In September 2015, the California State Legislature enacted, and Governor Brown signed into law three bills – Assembly Bill 243, Assembly Bill 266, and Senate Bill 643 – which together comprise the Medical Marijuana Regulation and Safety Act (the “MMRSA”). The MMRSA created a comprehensive dual state licensing system for the cultivation, manufacture, retail, sale, transport, distribution, delivery, and testing of medical cannabis. D. The MMRSA was renamed the Medical Cannabis Regulation and Safety Act (the “MCRSA”), under Senate Bill 837 in June 2016, which also made included substantive changes to the applicable state laws, which affect the various state agencies involved in regulating cannabis businesses as well as potential licensees. E. On November 8, 2016, the Control, Regulate, and Tax Adult Use of Marijuana Act (“AUMA”) was approved California voters as Proposition 64 and became effective on November 9, 2016, pursuant to the California Constitution (Cal. Const., art. II, § 10(a).). Proposition 64 legalized the nonmedical use of cannabis by persons 21 years of age and over, and the personal cultivation of up to six (6) cannabis plants. -2- F. AUMA also created a state regulatory and licensing system governing the commercial cultivation, testing, and distribution of nonmedical cannabis, and the manufacturing of nonmedical cannabis products. G. On June 27, 2017, Governor Brown signed the Legislature-approved Senate Bill 94. Senate Bill 94 combined elements of the MCRSA and AUMA to establish a streamlined singular regulatory and licensing structure for both medical and nonmedical cannabis activities. The new consolidated provisions under Senate Bill 94 is now known as the Medicinal and Adult- Use Cannabis Regulation and Safety Act (“MAUCRSA”) to be governed by the California Bureau of Cannabis Control. MAUCRSA refers to medical cannabis as “medicinal cannabis” and nonmedical/recreational cannabis as “adult-use cannabis.” H. On September 16, 2017, Governor Brown signed Assembly Bill 133 into law, which provided cleanup and substantive changes to MAUCRSA, including the removal of the requirement that licensed premises remain “separate and distinct” for each license type. I. MAUCRSA grants local jurisdictions discretion over whether businesses engaged in commercial cannabis activity may operate in a particular jurisdiction and, if authorized, where within such jurisdiction. J. On November 28, 2017, the City Council approved Ordinance No. 1382 amending the Lake Elsinore Municipal Code (“LEMC”) Chapter 17.156 to: (i) require all cannabis businesses in the City to have a State license and a City cannabis business permit; (ii) establish procedures for the review and issuance of a cannabis business permit ; (iii) to allow cannabis dispensaries, cannabis distribution, indoor cannabis cultivation, cannabis manufacturing and cannabis testing laboratories in M-1 (limited manufacturing) and M-2 (general manufacturing) zoning districts; and (iv) establish regulations related to such activities. K. Ordinance No. 1382 allows persons to engage in a permissible “Cannabis Business” upon the City’s issuance of a “Cannabis Business Permit,” which requires City approval of a conditional use permit, development agreement, and other applicable approvals. L. Developer has an equitable interest in that certain real property located at: (i) 31875 Corydon Street, Suite 120 in the City of Lake Elsinore, County of Riverside, State of California, Assessor’s Parcel Number 370-051-008 (“Parcel 1”), which is within a manufacturing zoning district; and (ii) 31881 Corydon Road, Suite 160 in the City of Lake Elsinore, County of Riverside, State of California, Assessor’s Parcel Number 370-051-031 (“Parcel 2’), which is within a manufacturing zoning district (Parcel 1 and Parcel 2 are collectively referred to as the “Site”). M. The Site is more particularly described in the legal description attached hereto as Exhibit A, and the combined Site Plan and Floor Plan is attached hereto as Exhibit B. N. Developer affirms that it has an equitable interest in the Site, evidenced in writing with the owner of the Site, Donna Marie Ostermiller, as trustee of the Donna Marie Ostermiller Separate Property Trust, UDT 10/22/18 and Timothy J. Scalzo, as successor trustee of the Frederick Thomas Scalzo Separate Property Trust, UDT 2/27/18 (the “Property Owner”), for the purpose of carrying out the Project. -3- O. The Property Owner has provided notarized written consent to the terms of this Agreement and the recordation thereof, attached hereto as Exhibit C. P. Developer proposes to improve, develop, and use the Site for a Cannabis Business (as defined below), in accordance with California Cannabis Laws (as defined below) and the LEMC, as each may be amended from time to time (the “Project”). Q. To strengthen the public planning process, encourage private participation in comprehensive planning and reduce the economic risk of development, the California Legislature adopted Government Code section 65864 et seq. (the “Development Agreement Statute”), which authorizes the City and an individual with an interest in real property to enter into a development agreement that establishes certain development rights in real property that is subject to a development agreement application. R. Consistent with the requirements of the Development Agreement Statute, the City adopted LEMC, Chapter 19.12 (“Development Agreement Ordinance”) authorizing the use of and establishing the procedures and requirements for the consideration of development agreements within the City. S. LEMC, Section 19.12.010 requires submittal of an application along with information and supporting data as requested by the Director of Community Development for consideration of any development agreement. Developer has satisfied this requirement. T. On ____________ __, 2020, the City of Lake Elsinore Planning Commission held a duly noticed public hearing to consider the Developer’s application for this Agreement and recommended to the City Council approval of this Agreement. U. On ____________ __, 2020, the City Council held a duly noticed public hearing to consider this Agreement and found and determined that this Agreement: (a) is consistent with the objectives, policies, general land uses and programs specified in the City’s General Plan and any applicable specific plan; (b) is compatible with the uses authorized in, and the regulations prescribed for the Site and the surrounding area and will not adversely affect the orderly development of the Site or the preservation of property values; (c) is in conformity with public convenience, general welfare and good land use practices; (d) will have an overall positive effect on the health, safety and welfare of the residents of and visitors to the City; and (e) constitutes a lawful, present exercise of the City’s police power and authority under the Development Agreement Statute and Development Agreement Ordinance. V. Based on the findings set forth in Section 1.1, the City Council entered into this Agreement pursuant to and in compliance with the requirements of the Development Agreement Statute and the Development Agreement Ordinance; and did therefore, in approving this Agreement introduce for first reading Ordinance No. __________ (the “Enabling Ordinance”). On ____________ __, 2020, the City Council conducted the second reading of the Enabling Ordinance thereby approving this Agreement, to become effective thirty (30) days after the adoption thereof. NOW, THEREFORE, in consideration of the mutual terms, obligations, promises, covenants and conditions contained herein and for other valuable consideration, the sufficiency of -4- which is hereby acknowledged, the Parties, and each of them, agree as follows: AGREEMENT ARTICLE 1. GENERAL PROVISIONS 1.1. Findings. City hereby finds and determines that entering into this Agreement furthers the public health, safety, and general welfare and is consistent with the City’s General Plan. 1.2. Recitals. The Recitals above are true and correct and are hereby incorporated into and made a part of this Agreement. In the event of any inconsistency between the Recitals and the provisions of Articles 1 through 9 of this Agreement, the provisions of Articles 1 through 9 shall prevail. 1.3. Exhibits. The following “Exhibits” are attached to and incorporated into this Agreement: Exhibit A Legal Description Exhibit B Site Plan and Floor Plan Exhibit C Property Owner Consent 1.4. Definitions. All following initially-capitalized words, terms, and phrases have the meanings assigned to them below, unless the context indicates otherwise. “Additional City Approvals” means all ministerial and discretionary permits, licenses, or other similar entitlements that must be secured by the Developer in order to develop the Project on the Site, in addition to the Conditional Use Permit and the Cannabis Business Permit. “Additional Insureds” has the meaning set forth in Section 5.1. “Agreement” means this Development Agreement and all Exhibits attached hereto. “AUMA” has the meaning as set forth in the Recitals, above. “California Building Standards Codes” means the California Building Code, as amended from time to time, in Part 2, Volumes 1 and 2, as part of Title 24 of the California Code of Regulations, as may be adopted by the LEMC. “California Cannabis Laws” includes AUMA, MAUCRSA, CUA, the MMP, and the regulations adopted and promulgated by the State Licensing Authorities pursuant to such laws, as such laws and regulations may be amended from time to time. -5- “Cannabis” means all parts of the plant Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. “Cannabis” also means the separated resin, whether crude or purified, obtained from cannabis. “Cannabis” does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this division, “cannabis” does not mean “industrial hemp” as defined by Section 11018.5 of the Health and Safety Code. Cannabis and the term “marijuana” may be used interchangeably. “Cannabis Business” includes cultivation, possession, manufacture, processing, storing, laboratory testing, labeling, transpo rting, distribution, delivery, or sale of cannabis or a cannabis product that requires a state license pursuant to MAUCRSA. “Cannabis Business Permit” means the City permit established and authorized by LEMC, Section 17.156.040, authorizing permissible Cannabis Business activity which can only be issued upon City approval of a conditional use permit, development agreement, and Additional City Approvals for each proposed Cannabis Business activity project. “City” means the City of Lake Elsinore, a municipal corporation. “City Council” means the City of Lake Elsinore City Council as described in LEMC, Chapter 2.08. “City Manager” means the City Manager of the City of Lake Elsinore, or designee, as described in LEMC, Chapter 2.04. “Community Benefits” has the meaning set forth in Section 4.1 of this Agreement. “Community Benefits Fees” has the meaning set forth in Section 4.2 of this Agreement. “Conditional Use Permit” means a conditional use permit issued by the City to Developer pertaining to Developer’s development of the Project, pursuant to LEMC, Chapter 17.168. In the event that the Conditional Use Permit may not have been issued to the Developer as of the Effective Date, the City hereby reserves its discretion under the police power to approve, conditionally approve, or deny the issuance of the Conditional Use Permit. “CUA” has the meaning as set forth in the Recitals, above. “Developer” means VERT Lake Elsinore LLC, a California limited liability company. “Development Agreement Ordinance” has the meaning as set forth in the Recitals, above. -6- “Development Agreement Statute” has the meaning as set forth in the Recitals, above. “Development Regulations” means the following regulations as they are in effect as of the Effective Date and to the extent they govern or regulate the development of the Site, but excluding any amendment or modification to the Development Regulations adopted, approved, or imposed after the Effective Date that impairs or restricts Developer’s rights set forth in this Agreement, unless such amendment or modification is expressly authorized by this Agreement or is agreed to by Developer in writing: the City’s General Plan; any existing Spec ific Plan that include the Site, and, to the extent not expressly superseded by this Agreement, all other land use and subdivision regulations governing the permitted uses, density and intensity of use for obtaining required City permits and approvals for development, and similar matters that may apply to development of the Project on the Site during the Term of this Agreement that are set forth in Title 16 of the LEMC (Subdivisions), Title 17 of the LEMC (Zoning), and Title 19 of the LEMC (Development). Notwithstanding the foregoing, the term “Development Regulations,” as used herein, does not include any City ordinance, resolution, code, rule, regulation or official policy governing any of the following: (i) the conduct of businesses, professions, and occupations; (ii) taxes and assessments; (iii) the control and abatement of nuisances; (iv) the granting of encroachment permits and the conveyance of rights and interests which provide for the use of or the entry upon public property; (v) the exercise of the power of eminent domain; or (vi) the California Building Standards Codes. “Effective Date” has the meaning as set forth in Section 1.6. “Exhibits” has the meaning set forth in Section 1.3. “Floor Area” means rentable interior floor area at the Site; rentable square footage measured based on Building Owners and Managers Association International industrial building standards. “Marijuana” has the same meaning as cannabis and those terms may be used interchangeably. “MAUCRSA” has the meaning as set forth in the Recitals, above. “MCRSA” has the meaning as set forth in the Recitals, above. “MMP” has the meaning as set forth in the Recitals, above. “MMRSA” has the meaning as set forth in the Recitals, above. “Mortgage” has the meaning set forth in Article 6. “Non-Payment Penalty” has the meaning set forth in Section 4.3. “Notice of Non-Payment Penalty” has the meaning set forth in Section 4.3. “Project” has the meaning as set forth in the Recitals, above. -7- “Property Owner” means George Sadler. “Regulatory Fees” mean charges owed by the Developer to the City for the City’s costs incurred in processing applications related to the Project, administering its cannabis-related ordinance with regard to the Project, and monitoring legal compliance of the Project on the Site, including, but not limited to building and safety-related inspections by the City. “Site” has the meaning as set forth in the Recitals, above. “State Cannabis License” means a license, including a temporary license, to conduct Cannabis Business activities issued by a State Licensing Authority to Developer for the Development of the Project on the Site. “State Licensing Authority” means the state agency responsible for the issuance, renewal, or reinstatement of State Cannabis Licenses, or the state agency authorized to take disciplinary action against a business licensed under the California Cannabis Laws. “Term” has the meaning described in Section 1.7. “Term Commencement Date” has the meaning described in Section 1.7. 1.5. Project is a Private Undertaking. The Parties agree that the Project is a private development and that City has no interest therein, except as authorized in the exercise of its governmental functions. City shall not for any purpose be considered an agent of Developer or the Project. 1.6. Effective Date of Agreement. This Agreement shall become effective (the “Effective Date”) upon the date when all of the following conditions have been satisfied: (i) the City ordinance approving this Agreement becomes effective; (ii) this Agreement has been fully executed by the Parties; and (iii) the Developer have delivered evidence of insurance coverage in favor of the City as set forth in Article 5 of this Agreement. 1.7. Term. The term of this Agreement (the “Term”) shall be twenty (20) years commencing from the issuance of the Cannabis Business License to Developer for the Project (the “Term Commencement Date”). Nothing in this Section 1.7 shall prohibit or otherwise restrict the termination of this Agreement in accordance with Section 1.8. 1.8. Termination. This Agreement shall terminate upon the occurrence of any of the following events: a. the expiration of the Term; b. the Developer no longer has a possessory, legal or other equitable interest in the Site; c. the Developer has ceased all operations related to the Project on the Site for a period of one year or more; -8- d. mutual written consent of the Parties; e. abandonment of the Developer’s Conditional Use Permit pursuant to LEMC, Section 17.168.080 including the failure of the Developer to commence operation of the Project on the Site within the time presented following the approval of the Conditional Use Permit; f. suspension or revocation of Developer’s Conditional Use Permit pursuant to LEMC, Section 17.168.110; g. following the Term Commencement Date, the failure to have a valid Cannabis Business Permit for the Project; h. following the Term Commencement Date, the failure to have a valid Developer’s State Cannabis Permit for the Project; or i. unauthorized assignment of interest of the Developer in the Project or in the Site pursuant to Section 9.1 of this Agreement. The rights and obligations of the Parties set forth in Sections 4.2, 4.3, 4.4, 5.4, 9.2, 9.3, 9.4, and 9.6 of this Agreement and any right or obligation of the Parties in this Agreement, which by its express terms or nature and context is intended to survive termination of this Agreement, will survive any such termination. 1.9. Operating Memoranda; Amendment of Agreement. a. Operating Memoranda. The provisions of this Agreement require a close degree of cooperation between the City and the Developer. The Development of the Developer Property may demonstrate that clarifications to this Agreement and the Existing Land Use Regulations are appropriate with respect to the details of performance of the City and the Developer. To the extent allowable by law, the Developer shall retain a certain degree of flexibility as provided herein with respect to all matters, items and provisions covered in general under this Agreement, except for those which relate to the (i) term; (ii) permitted uses; or (iii) density or intensity of use. When and if the Developer finds it necessary or appropriate to make changes, adjustments or clarifications to matters, items or provisions not enumerated in (i) through (iii) above, the Parties shall effectuate such changes, adjustments or clarifications through operating memoranda (the “Operating Memoranda”) approved by the Parties in writing which reference this Section 1.9(a). Operating Memoranda are not intended to constitute an amendment to this Agreement but mere ministerial clarifications; therefore public notices and hearings shall not be required. The City Manager shall be authorized, upon consultation with, and approval of, the Developer, to determine whether a requested clarification may be effectuated pursuant to this Section or whether the requested clarification is of such character to constitute an amendment to this Agreement which requires compliance with the provisions of Section 1.9(b) below. b. Amendment. Subject to the notice and hearing requirements of the Government Code, this Agreement may be modified or amended from time to time only with the written consent of the Developer and the City or their successors and assigns in accordance with the provisions of the Development Agreement Ordinance and the Development Agreement Statute. -9- 1.10. Fees. Developer agrees to pay all Regulatory Fees, Community Benefit s Fee, and any other applicable fees to the City related to Developer ’s development and operation of the Project on the Site. ARTICLE 2. DEVELOPMENT OF THE PROPERTY 2.1. Intent. Developer has expended and will continue to expend substantial amounts of time and money planning and preparing for development of the Project. Developer represents and City acknowledges that Developer would not make these expenditures without this Agreement, and that Developer is and will be making these expenditures in reasonable reliance upon its vested rights to develop the Project as set forth in this Agreement. 2.2. Vested Right to Develop. During the Term, Developer shall have the vested right to develop the Project on the Site, in accordance with the Agreement, the Conditional Use Permit, Additional City Approvals if any, the Cannabis Business Permit, the City’s Development Regulations. 2.3. Permitted Uses and Operational Requirements. Developer shall be permitted to develop, construct, and use the Site to carry out the Project, consistent with California Cannabis Laws, this Agreement, the Conditional Use Permit, Additional City Approvals, the Cannabis Business Permit, the LEMC (as may be amended except for the Development Regulations), and the State Cannabis License. 2.4. Additional Entitlements, Approvals, and Permits. Successful implementation of the Project may require the Developer to obtain additional approvals and permits from City and other local and state agencies. In connection with the consideration and issuance of any such Additional City Approval which is not ministerial in nature, the City reserves its discretion under the police power to approve, conditionally approve, or deny the issuance of each City Additional Approval. 2.5. Conditional Use Permit. Pursuant to LEMC, Chapter 19.12, Developer shall not engage in the permitted uses set forth above pertaining to the Project on the Site without first obtaining the Conditional Use Permit allowing for the operating of a “cannabis business” (as defined in Section 17.156.030 of the LEMC). 2.6. Cannabis Business Permit. Pursuant to LEMC, Section 17.156.040, no person may engage in a “cannabis business” in the City without obtaining a Cannabis Business Permit. 2.7. State Cannabis License. Pursuant to California Cannabis Laws, Developer shall not engage in the permitted uses set forth above pertaining to the Project on the Site without first obtaining a State Cannabis License necessary to conduct the type of Cannabis Business on the Site as authorized by the Cannabis Business Permit. -10- ARTICLE 3. APPLICABLE RULES, REGULATIONS, AND OFFICIAL POLICIES 3.1. Rules on Permitted Uses. Unless otherwise provided in this Agreement, the City’s ordinances, resolutions, rules, regulations, and official policies governing the permitted uses of the Site and the maximum height, bulk, and size of proposed buildings related to the Project on the Site shall be those in force and effect at the time of the City’s issuance of the Cannabis Business Permit for the development of the Project at the Site. 3.2. Rules on Design and Construction. Unless otherwise provided in this Agreement, the ordinances, resolutions, rules, regulations, and official policies governing the design, improvement, and construction standards and specifications applicable to the Project shall be those in force and effect at the time of the City’s issuance of the Cannabis Business Permit for the development of the Project at the Site. 3.3. Uniform Codes Applicable. Unless otherwise provided in this Agreement, the Project shall be improved and constructed in accordance with the provisions of the California Building Standards Codes in effect at the time as of the time of the City’s consideration of approval of the relevant permit sought by Developer for the Project. 3.4. Changes Mandated by Federal or State Law. The Site and Project shall be subject to subsequently enacted state or federal laws or regulations that may preempt the LEMC, or mandate the adoption or amendment of local regulations, or are in conflict with this Agreement or local rules or guidelines associated with City’s Cannabis Uses (LEMC, Ch. 17.156) or Cannabis Business Permit. As provided in section 65869.5 of the Development Agreement Statute, in the event state or federal laws or regulations enacted after the Effective Date prevent or preclude compliance with one or more provisions of this Agreement, such provisions shall be modified or suspended as may be necessary to comply with such state or federal laws or regulations. Upon discovery of a subsequently enacted federal or state law meeting the requirements of this Section, City or Developer shall provide the other Party with written notice of the state or federal law or regulation, and a written statement of the conflicts thereby raised with the provisions of the LEMC or this Agreement. Promptly thereafter, City and Developer shall meet and confer in good faith in a reasonable attempt to modify this Agreement, as necessary, to comply with such federal or state law or regulation provided City shall not be obligated to agree to any modification materially increasing its obligations or materially adversely affecting its rights and benefits hereunder. In such discussions, City and Developer will attempt to preserve the terms of this Agreement and the rights of Developer derived from this Agreement to the maximum feasible extent while resolving the conflict. If City, in its judgment, determines it necessary to modify this Agreement to address such conflict, City shall have the right and responsibility to do so, and shall not have any liability to Developer for doing so or be considered in breach or default of this Agreement. City also agrees to process, in accordance with the provisions of this Agreement, Developer’s proposed changes to the Project that are necessary to comply with such federal or state law and that such proposed changes shall be conclusively deemed to be consistent with this Agreement without further need for any amendment to this Agreement. 3.5. Health and Safety Emergencies. In the event that any future public health and safety emergencies arise with respect to the development contemplated by this Agreement, City -11- agrees that it shall attempt, if reasonably possible as determined by City in its discretion, to address such em ergency in a wa y that does not have a material adverse impact on the Project. 3.6. Reservation of Authority. Any other provision of this Agreement to the contrary notwithstanding, the development of the Project shall be subject to new or modified ordinances, resolutions, rules, regulations, and official policies related to the following: a. Regulatory Fees imposed on the Developer by the City, which are charged by the City to cover its actual and reasonable expenses incurred in processing permits, licenses, and other entitlements related to the Project, administering its cannabis -related ordinance with regard to the Project, and monitoring legal compliance of the Project on the Site, including, but not limited to building and safety-related inspections by the City; b. Development impact fees or charges imposed by the City on and in connection with a development or other similar fees or charges imposed by other governmental entities regardless of whether the City is required to collect or assess such fees pursuant to applicable laws (e.g., school district impact fees pursuant to Government Code Section 65995), or general or special taxes and assessments. c. Procedural regulations related to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals, and other similar procedural matters; and d. Regulations, including, but not limited to, the California Building Standards Codes, necessary to protect the public health and safety so long as such regulations are generally applicable and do not impose a severe and significant financial burden on the Developer or materially delay the development or carrying out of the Project as contemplated in this Agreement. ARTICLE 4. COMMUNITY BENEFITS FEE 4.1. Intent. The Parties acknowledge and agree that this Agreement confers substantial private benefits on the Developer that will place significant burdens, including both known costs and potential but currently unknown costs, on City infrastructure, services, and neighborhoods and that the private benefits provided to the Developer should be balanced with commensurate public benefits for the community (“Community Benefits”). Accordingly, City and Developer recognize and agree that but for Developer’s payments as provided herein, City would not and could not approve use of the Site for the Project as provided by this Agreement. City’s approval of this Agreement is in reliance upon and in consideration of Developer’s agreement to make the payments required hereunder. 4.2. Community Benefits Fee. In addition to Developer’s obligation to pay the City through its Regulatory Fees, Developer shall be obligated to provide Community Benefits as follows, which shall be referred to as the “Community Benefits Fee”: a. Community Benefits Fee. Concurrent with the Term Commencement Date, and on each anniversary thereafter, Developer shall make payment to the City pursuant to the following fee schedule: -12- All Cannabis Business activities $18.72 per square foot of Floor Area annually Notwithstanding the foregoing, Developer may elect, on a one-time basis, to make payment of the Community Benefit Fee due on the Term Commencement Date in two equal installments, the first one-half installment to be made on the Term Commencement Date and the second one-half installment to be due and payable on a date six (6) months from the Term Commencement Date. b. Annual Increase. In order to account for the increasing cost of providing City services, the Community Benefits Fee set forth in Section 4.2(a) shall be increased annually commencing on each anniversary of the Term Commencement Date (each of which day shall be referred to as an “Adjustment Date”). Each Adjustment Date shall be numbered in sequence (e.g., First Adjustment Date, Second Adjustment Date, Third Adjustment Date, etc.). Each such annual increase in the Community Benefits Fee shall be determined as follows: Four percent (4%) of the amount of the Community Benefits Fee payable immediately preceding such adjustment (For example and for illustration purposes only, if Developer’s Community Benefits Fee was $151,613.28 [$18.72 x 8,099 square feet of Floor Area] upon the initial issuance of a Cannabis Business Permit on September 15, 2020, the Community Benefits Fee due on the First Adjustment Date, that is, September 15, 2021, is the product of $151,613.28 times 1.04, in which case the Community Benefits Fee payable on the First Adjustment Date would be $157,677.81. 4.3. Penalty. If Developer fails to make a payment of the Community Benefits Fee, as required by this Agreement, the City may impose a “Non-Payment Penalty.” A Non- Payment Penalty of five percent (5%) shall be applied to all past due Community Benefits Fees. The City shall deliver to Developer a “Notice of Non-Payment Penalty.” Payment of the Non- Payment Penalty and past due Community Benefits Fees shall be in a single installment due on or before a date fifteen (15) days following delivery of the Non-Payment Penalty. 4.4. Interest on Unpaid Non-Performance Penalty; Past Due Community Benefits Fees. If Developer fails to pay the Non-Performance Penalty and all past due Community Benefits Fees after City has delivered the Notice of Non-Performance Penalty, then, in addition to the principal amount of the Non-performance Penalty and past due Community Benefit Fees, Developer shall pay City interest at the rate of eighteen percent (18%) per annum, computed on the principal amount of the Non-Performance Penalty and past due Community Benefit Fees, from a date fifteen (15) days following delivery of the Notice of Non-performance Penalty. Notwithstanding the foregoing provisions of this Section 4.4, in no event shal l the rate of interest payable by Developer exceed the maximum rate of interest permitted to be charged under applicable law. -13- ARTICLE 5. INSURANCE AND INDEMNIFICATION 5.1. General Liability Insurance. Developer shall maintain comprehensive general liability insurance issued by a California admitted insurance courier whose Best Insurance Guide, current edition insurance rating is not less than “B+(vii)” with a per-occurrence combined single limit of not less than Two Million Dollars ($2,000,000) with a claim deduction not more than One Hundred Thousand Dollars ($100,000) per claim. Such insurance policy shall name the City and City’s elected and appointed councils, boards, commissions, legislative bodies, officials, employees, and representatives as “Additional Insureds” by endorsement with respect to the performance of this Agreement and shall include either a severability of interest clause or cross- liability endorsement and other customary and reasonable endorsements and provisions approved by the City’s risk manager. 5.2. Workers’ Compensation Insurance. Developer shall maintain workers’ compensation insurance for all its employees employed at or on the Project. Developer shall require each contractor and subcontractor working at or on the Project to provide workers’ compensation insurance for its respective employees. Developer indemnification of City set forth in Section 5.4 of this Agreement shall apply to Developer’s failure to maintain any such insurance. 5.3. Evidence of Insurance. Evidence of the insurance in favor of the City required under Section 5.1 shall be provided to the City as of the Effective Date. Thereafter no Cannabis Business Permit for the Project shall be valid unless and until Developer furnishes satisfactory evidence of the other insurance required in Article 5 of this Agreement. In each case, the evidence of insurance provided to the City shall include satisfactory evidence that the insurance carrier shall give the City at least fifteen (15) days’ prior notice of the cancellation or reduction in coverage of each policy of insurance required in Article 5 of this Agreement. 5.4. Indemnification. The Developer agrees to indemnify, defend with counsel acceptable to City, and hold harmless the City and City’s elected and appointed councils, boards, commissions, legislative bodies, officials, employees, and representatives from any and all claims, costs (including legal fees and costs), or liabilities of any kind arising out of or connected to any act or omission of Developer or Developer’s contractor, subcontractor, agent, or representative related to its establishment or operation of the Project or arising out of or related to the approval or issuance of any permit, license, or approval by the City for the Project, except to the extent such claims, costs, and liabilities are caused by the sole negligence or willful misconduct of the City. The Developer agrees that it shall be responsible for all costs incurred by the City in the event of a third- party challenge related to such claims, costs, or liabilities. 5.5. Failure to Indemnify. The Developer’s failure to indemnify the City, when required by this Agreement, shall constitute a material breach of this Agreement and of any applicable Conditional Use Permit, Cannabis Business Permit, and Additional City Approvals, which shall entitle the City to all remedies available under law, including, but not limited to, specific performance and damages. Failure to indemnify shall constitute grounds upon which the City may rescind its approval of any entitlement, permit, or license related to the Project, or any portion thereof, and a waiver of Developer’s right to file a claim, action, or proceeding against the City and City’s elected and appointed councils, boards, commissions, legislative bodies, officials, -14- employees, and representatives based upon the City’s rescission or revocation of any applicable Conditional Use Permit, Cannabis Business Permit, and Additional City Approvals, or City’s failure to defend any claim, action, or proceeding based upon Developer’s failure to indemnify the City. 5.6. Waiver of Damages; Referendum. Notwithstanding anything in this Agreement to the contrary, the Parties acknowledge that City would not have entered into this Agreement had it been exposed to liability for damages from the Developer and, therefore, the Developer hereby waives all claims for damages against City for breach of this Agreement. The approvals (including development agreements) must be approved by the City Council and that, under law, the City Council's discretion to vote in any particular way may not be constrained by contract. The Developer therefore waives all claims for damages against City in the event that this Agreement or any Project approval is: (1) not approved by the City Council or (2) is approved by the City Council, but with new changes, amendments, conditions, or deletions to which Developer is opposed. Developer further acknowledges that, as an instrument which must be approved by ordinance, a development agreement is subject to referendum; and that, under law, the City Council's discretion to avoid a referendum by rescinding its approval of the underlying ordinance may not be constrained by contract, and Developer waives all claims for damages against City in this regard. 5.7. Bankruptcy. The obligations of this Agreement shall not be dischargeable in bankruptcy. ARTICLE 6. MORTGAGEE PROTECTION This Agreement, once executed and recorded, shall be superior and senior to any lien placed upon the Site or any portion thereof following recording of this Agreement, including the lien of any deed of trust or mortgage (“Mortgage”). Notwithstanding the foregoing, no breach hereof shall defeat, render invalid, diminish, or impair the lien of any Mortgage made in good faith and for value. This Agreement shall immediately be deemed in default and immediately terminate upon the foreclosure or transfer of any interest in the Site or Project, whether by operation of law or any other method of interest change or transfer, unless the City Manager has authorized such change or transfer in advance, in writing. ARTICLE 7. PERIODIC REVIEW City shall review this Agreement (“Periodic Review”) in accordance with the Development Agreement Ordinance, including LEMC, Section 19.12.140 and the procedures set forth in LEMC, Section 19.12.150. Notwithstanding the foregoing, the City’s failure to review the Developer’s compliance with this Agreement, at least annually, will not constitute or be asserted by either Party as a breach by the other Party. ARTICLE 8. DEFAULT 8.1. General Provisions. The failure of either Party to perform any obligation or duty under this Agreement within the time required by this Agreement shall be a default and after the -15- giving of notice and the passage of the applicable amount of time, such a default shall constitute an event of default. 8.2. Notice. The “Complaining Party” may not asse rt that an event of default has occurred against the “Defaulting Party” unless the Complaining Party has first given written notice to the Defaulting Party, specifying the nature o f the default and the manner in which the default may be cured, if known to the Complaining Party. Any failure or delay by the Complaining Party in giving such notice shall not waive such default or waive any of the Complaining Party’s remedies. 8.3. Cure. The Defaulting Party shall have thirty (30) days from the receipt of notice to cure the default except as provided in the next sentence. In the case of a monetary default (e.g. failure to make the payments of fees required under this Ordinance), any such defau lt must be cured by the payment of the amount demanded within such thirty (30) day period. In the case of non-monetary defaults, if the default cannot be reasonably cured within such time, the default shall be deemed cured if: a. The cure is commenced at the earliest practicable date following receipt of notice; b. The cure is diligently prosecuted to completion; c. At the earliest practicable date (but in no event later than thirty (30) days after receiving the notice of default), the Defaulting Party provides writ ten notice to the Complaining Party that the cure cannot be reasonably completed within such thirty (30) day period; and d. The default is cured at the earliest practicable date, but in no event later than sixty (60) days after receipt of the first notice of default. 8.4. Remedies. If the Defaulting Party fails to cure a default in accordance with the foregoing, an event of default shall be deemed to have occurred and the Complaining Party shall have the right to seek all appropriate remedies, at law or in equity, including specific penalty or termination of this Agreement without further or separate notice to the Defaulting Party. 8.5. Estoppel Certificates. a. City shall, upon not less than thirty (30) days prior written notice, execute, acknowledge, and deliver to Developer, Developer's lender, potential investors, or assignees an estoppel certificate in writing which certifies that this Agreement is in full force and effect, that there are no breaches or defaults under the Agreement except as described in such estoppel certificate, and that the Agreement has not been modified or terminated and is enforceable in accordance with its terms and conditions. b. The City may recover its actual and reasonable costs and attorneys’ fees in connection with the timely dealing of any such estoppel certificate, in an amount not to exceed $2,500 per estoppel certificate. -16- ARTICLE 9. OTHER GENERAL PROVISIONS 9.1. Assignment. The rights and obligations of Developer hereunder shall not be assigned or transferred, except that on thirty (30) days written notice to City, Developer may assign all or a portion of Developer’s rights and obligations there under to any person or persons, partnership or corporation who purchases all or a portion of Developer’s right, title and interest in the Site, or Project, provided such assignee or grantee assumes in writing each and every obligation of Developer hereunder yet to be performed, and further provided that Developer obtains the written consent of City to the assignment, which consent shall not be unreasonably withheld. Notwithstanding the foregoing provision concerning the written consent of City, and provided that the assignment is to an affiliate of Developer (an entity which is controlled by, controls, or is under common control with, Developer), the City shall in such cases provide its written consent provided that all other requirements of this Section 9.1 are satisfied. The notice to City shall include the identity of any such assignee and a copy of the written assumption of the assignor’s obligations hereunder pertaining to the portion assigned or transferred. After such notice and the receipt of such consent, the assignor shall have no further obligations or liabilities hereunder. The City Manager may act on behalf of City regarding any actions concerning the assignment of this Agreement. 9.2. Notices. Any notice shall be in writing and given by delivering the same in person or by sending the same by registered, or certified mail, return receipt requested, with postage prepaid, or by overnight delivery, to the respective mailing addresses, as follows: If to City: City of Lake Elsinore 130 S. Main Street Lake Elsinore, CA 92530 Attn: City Manager If to Developer: VERT Lake Elsinore LLC c/o Saif Alchi 15988 Sarah Ridge Ct. San Diego, CA 92127 Either City or Developer may change its mailing address at any time by giving written notice of such change to the other in the manner provided herein at least ten (10) days prior to the date such change is effected. All notices under this Agreement shall be deemed given, received, made or communicated on the earlier of the date personal delivery is effected or on the delivery date or attempted delivery date shown on the return receipt, or air bill. 9.3. Governing Law and Venue. This Agreement shall be interpreted and governed according to the laws of the State of California. In the event of litigation between the Parties, venue, without exception, shall be in the Riverside County Superior Court of the State of California. If, and only if, applicable law requires that all or part of any such litigation be tried exclusively in federal court, venue, without exception, shall be in the Central District of California located in the City of Riverside, California. -17- 9.4. Severability. If this Agreement in its entirety is determined by a court to be invalid or unenforceable, this Agreement shall automatically terminate as of the date of final entry of judgment. If any term or provision of this Agreement shall be determined by a court to be invalid and unenforceable, or if any term or provision of this Agreement is rendered invalid or unenforceable according to the terms of any federal or state statute, any provisions that are not invalid or unenforceable shall continue in full force and effect and shall be construed to give effect to the intent of this Agreement. The Parties expressly agree that each Party is strictly prohibited from failing to perform any and all obligations under this Agreement on the basis that this Agreement is invalid, unenforceable, or illegal. By entering into this Agreement, each Party disclaims any right to tender an affirmative defense in any arbitration or court of competent jurisdiction, that performance under this Agreement is not required because the Agreement is invalid, unenforceable, or illegal. 9.5. Constructive Notice and Acceptance. Every person who after the Effective Date and recording of this Agreement owns or acquires any right, title, or interest to any portion of the Site is and shall be conclusively deemed to have consented and agreed to every provision contained herein, whether or not any reference to this Agreement is contained in the instrument by which such person acquired an interest in the Site, and all rights and interests of such person in the Site shall be subject to the terms, requirements, and provisions of this Agreement. 9.6. Reserved. 9.7. Waiver. A waiver by any Party of any breach of any term, covenant, or condition herein contained or a waiver of any right or remedy of such Party available hereunder, at law or in equity, shall not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition herein contained or of any continued or subsequent right to the same right or remedy. No Party shall be deemed to have made any such waiver unless it is in writing and signed by the Party so waiving. 9.8. Integration. This Agreement, together with its specific references, attachments, and Exhibits, constitutes all of the agreements, understandings, representations, conditions, warranties, and covenants made by and between the Parties hereto. Unless set forth herein, no Party to this Agreement shall be liable for any representations made, express or implied. 9.9. Captions. The captions of this Agreement are for convenience and reference only and the words contained therein shall in no way be held to explain, modify, amplify, or aid in the interpretation, construction, or meaning of the provisions of this Agreement. 9.10. Mandatory and Permissive. “Shall” and “will” and “agrees” are mandatory. “May” or “can” are permissive. 9.11. Counterparts. This Agreement may be executed simultaneously and in several counterparts, each of which shall be deemed an original, but which together shall constitute one and the same instrument. 9.12. Other Documents. The Parties agree that they shall cooperate in good faith to accomplish the objectives of this Agreement and, to that end, agree to execute and deliver such -18- other instruments or documents as may be necessary and convenient to fulfill the purposes and intentions of this Agreement. 9.13. Authority. All Parties to this Agreement warrant and represent that they have the power and authority to enter into this Agreement. 9.14. Advice of Legal Counsel. Each Party acknowledges that it has reviewed this Agreement with its own legal counsel and, based upon the advice of that counsel, freely entered into this Agreement. 9.15. Attorneys’ Fees and Costs. Unless otherwise provided in this Agreement, if any action at law or in equity, including action for declaratory relief, is brought to enforce or interpret provisions of this Agreement, the prevailing Party shall be entitled to reasonable attorney's fees and costs, which may be set by the court in the same action or in a separate action brought for that purpose, in addition to any other relief to which such Party may be entitled. 9.16. Calculation of Time Period. All time referenced in this Agreement shall be calendar days, unless the last day falls on a legal holiday, Saturday, or Sunday, in which case the last day shall be the next business day. 9.17. Recordation of Development Agreement. The City Clerk shall cause a copy of this Agreement to be recorded against title of the Site within ten (10) business days of the Effective Date. [SIGNATURES ON NEXT PAGE] -19- IN WITNESS WHEREOF, the Parties have executed this Agreement as of the dates set forth below. “CITY” CITY OF LAKE ELSINORE, a municipal corporation Date: By: Mayor ATTEST: By: City Clerk “DEVELOPER” VERT LAKE ELSINORE LLC, a California limited liability company Date: By: Name: Saif Alchi Its: Member STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. Exhibit A EXHIBIT A LEGAL DESCRIPTION The real property referred to herein is situated in the County of Riverside, City of Lake Elsinore, State of California, and is described as follows: PARCEL 1: A CONDOMINIUM COMPRISING INTEREST IN UNIT # E-2 AS SHOWN ON THE CONDOMINIUM PLAN RECORDED ON JUNE 2, 2005, AS INSTRUMENT NUMBER 2005- 0441925 IN THE RIVERSIDE COUNTY OFFIC IAL RECORDS ("PLAN") AND AS FURTHER DESCRIBED IN THE DECLARATION OF RESTRICTIONS FOR INDUSTRIAL CONDOMINIUM OWNERSHIP RECORDED ON AUGUST 5, 2003 INSTRUMENT NUMBER 2003-592581 IN THE RIVERSIDE COUNTY OFFICIAL RECORDS AND AS AMENDED IN THE FIRST AMENDMENT OF DECLARATION OF RESTRICTIONS FOR BLUE LAKE CONDOMINIUM OWNERSHIP RECORDED ON MAY 27, 2005 AS INSTRUMENT NUMBER 2005-0423404 IN THE RIVERSIDE COUNTY OFFICIAL RECORDS (COLLECTIVELY, THE "DECLARATION"), WHICH CONDOMINIUM IS LOCATED ON THE REAL PROPERTY DESCRIBED AS PARCEL 2 AS SHOWN BY RECORD OF SURVEY ON FILE IN BOOK 73 PAGE 44 OF RECORDS OF SURVEY, RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. EXCEPTING THEREFROM AND RESERVING EASEMENTS AS DEFINED IN THE DECLARATION. FURTHER EXCEPTING THEREFROM ALL NUMBERED CONDOMINIUM UNITS ON THE PLAN AND DESCRIBED IN THE DECLARATION OTHER THAN THE UNIT CONVEYED ABOVE AND THE ASSOCIATION COMMON AREA OR COMMON AREA AS DEFINED IN THE DECLARATION OR SHOWN ON THE PLAN. [APN 370-051-008-0] PARCEL 2: A CONDOMINIUM COMPRISING INTERES T IN UNIT # H-6 AS SHOWN ON THE CONDOMINIUM PLAN RECORDED ON JUNE 2, 2005, AS INSTRUMENT NUMBER 2005- 0441925 IN THE RIVERSIDE COUNTY OFFICIAL RECORDS ("PLAN") AND AS FURTHER DESCRIBED IN THE DECLARATION OF RESTRICTIONS FOR INDUSTRIAL CONDOMINIUM OWNERSHIP RECORDED ON AUGUST. 5, 2003 INSTRUMENT NUMBER 2003·592581 IN THE RIVERSIDE COUNTY OFFICIAL RECORDS AND AS AMENDED IN THE FIRST AMENDMENT OF DECLARATION OF RESTRICTIONS FOR BLUE LAKE CONDOMINIUM OWNERSHIP RECORDED ON MAY 27, 2005 AS INSTRUMENT NUMBER 2005-0423404 IN THE RIVERSIDE COUNTY OFFICIAL RECORDS (COLLECTIVELY, THE "DECLARATION"), WHICH CONDOMINIUM IS LOCATED ON THE REAL PROPERTY DESCRIBED AS PARCEL 2 AS SHOWN BY RECORD OF SURVEY ON FILE IN BOOK 73 PAGE 44 OF RECORDS OF SURVEY, RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. FURTHER EXCEPTING THEREFROM ALL NUMBERED CONDOMINIUM UNITS ON THE PLAN AND DESCRIBED IN THE DECLARATION OTHER THAN THE UNIT CONVEYED ABOVE AND THE ASSOCIATION COMMON AREA OR COMMON AREA AS DEFINED IN THE DECLARATION OR SHOWN ON THE PLAN. [APN 370-051-031-0] Exhibit B EXHIBIT B SITE PLAN AND FLOOR PLAN The Site Plan and Floor Plan is on file as a public record and available for review at the City of Lake Elsinore’s City Clerk’s Office located 130 South Main Street Lake Elsinore, CA 92530. Exhibit C EXHIBIT C PROPERTY OWNER CONSENT Donna Marie Ostermiller, as trustee of the Donna Marie Ostermiller Separate Property Trust, UDT 10/22/18 and Timothy J. Scalzo, as successor trustee of the Frederick Thomas Scalzo Separate Property Trust, UDT 2/27/18, being the owners of the real property described in Exhibit A to this Development Agreement by and between the City of Lake Elsinore and VERT Lake Elsinore LLC, dated for identification as of August 1, 2020 (the “Agreement”), do hereby consent to the recordation of said Agreement in the Official Records of the County of Riverside. Donna Marie Ostermiller Separate Property Trust, UDT 10/22/18 Date: Donna Marie Ostermiller, Trustee Frederick Thomas Scalzo Separate Property Trust, UDT 2/27/18 Date: Timothy J. Scalzo, Successor Trustee [notary required] STATE OF CALIFORNIA ) ) § County of ) On , before me, a Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal. ________________________________ Signature of Notary (Affix seal here) A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. 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