Council approves fees for cannabis regulatory permits

By Camille DeVaul · Thu Sep 17 2026

New fee structure will cover city costs for regulating non-storefront cannabis delivery businesses

PASO ROBLES — The Paso Robles City Council unanimously approved fees Sept. 15 for the city’s newly established Cannabis Regulatory Permit program, establishing the costs for regulating non-storefront cannabis delivery businesses operating within the city.

The action followed the council’s Aug. 18 approval of a Cannabis Regulatory Permit program and its direction for staff to return with a fee schedule based on a hybrid service delivery model.

Finance Manager Catherine Piatti told the council the purpose of the Sept. 15 item was to establish the fees needed to administer and oversee the regulatory program.

“The purpose of tonight’s item is fairly straightforward as it’s simply to establish the fees necessary to administer and oversee the cannabis regulatory permit that was recently approved by City Council,” Piatti said.

Under the hybrid model, city staff will retain responsibility for the core administrative functions of the permitting process and remain the primary point of contact for cannabis businesses. A specialized consultant (Hdl Companies) will supplement city staff with technical cannabis regulatory expertise.

The regulatory permit is intended to provide the city with an ongoing mechanism to monitor the ownership, operations, and compliance of individual cannabis businesses. Piatti said the program is not intended to function as a one-time application, but instead provides the city with regular opportunities to monitor businesses and foster compliance.

The program covers areas including security, recordkeeping, delivery vehicles and drivers, inspections, renewals, transfers, and financial audits.

City staff will handle functions such as application intake, final permitting, and city inspection responsibilities. HdL will assist with technical application reviews, background checks, site and security-plan evaluations, compliance inspections, and financial audits.

Piatti said the arrangement allows the city to retain control over the program while using specialized expertise when needed.

The fees approved by the council include a $5,500 initial Cannabis Regulatory Permit application fee, a $4,600 annual renewal fee, an $11,000 triennial financial audit fee, and a $5,500 permit transfer fee. Appeals or revocation-related activities will be charged based on time and materials.

Background check costs will be billed directly to applicants by the consultant and will depend on the number of owners and employees requiring checks.

Piatti noted that the fees presented to the council Sept. 15 were the same fees previously presented during the Aug. 18 meeting.

The fees were developed using a full cost-recovery methodology, taking into account the estimated work required of both city staff and the consultant.

“The intent of these fees is not to generate additional revenue for the city, but rather to recover the reasonable costs for providing these services,” Piatti said.

She explained that the costs are attributable to the businesses being regulated rather than to a general city service that would be subsidized by the General Fund.

The proposed fees are also lower than those in several neighboring jurisdictions, although Piatti noted that the comparison is not directly equivalent because other jurisdictions regulate a broader range of cannabis businesses, including storefront retailers and cultivation operations. Paso Robles’ proposed fees apply specifically to non-storefront delivery businesses.

The new regulatory fees will not replace other fees, taxes or regulatory requirements that may apply to cannabis businesses. Those businesses will continue to be responsible for applicable Conditional Use Permit fees, building permit fees, business license and cannabis business taxes, among other charges.

The council also discussed the division of responsibilities between city staff and HdL under the hybrid model.

Mayor John Hamon questioned whether some of the responsibilities assigned to city staff and the consultant represented overlapping work.

Piatti confirmed that there would be areas in which both city staff and the consultant would work together.

She said some of that overlap is intentional, allowing city staff to learn more about cannabis regulatory operations and helping the police department become familiar with the regulatory issues and standards being reviewed by the consultant.

“There’s certain elements from a city standpoint that we would like to see that’s maybe not the standard for the consultant as well,” Piatti said. “So that way we’re able to work together to cover all the bases.”

The fees are regulatory rather than development-related, meaning the 60-day waiting period applicable to certain development fees does not apply. The fees therefore take effect immediately upon council adoption.

Going forward, the fees will be reviewed and adjusted annually using the Consumer Price Index, with adjustments taking effect July 1. Staff will also periodically review the program to determine whether the fees continue to reflect the city’s reasonable costs.

Because the program is new, Piatti said there is some uncertainty regarding the eventual volume and complexity of applications, renewals and other regulatory activities. If actual costs differ materially from the assumptions used to establish the fees, staff could return to the council with recommended adjustments.

The city does not anticipate generating revenue in excess of the costs associated with administering the program.

The resolution passed unanimously, with Councilmembers Steve Gregory, Kris Beal, Chris Bausch, Fred Strong, and Mayor Hamon voting in favor.

The approval establishes the fee structure needed to implement the Cannabis Regulatory Permit program approved by the council in August.

The next Paso Robles City Council meeting is schedule for Tuesday, Oct. 6, at 6 p.m. in the Norris Room at Centennial Park.