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HomeMy WebLinkAboutWS.6 Memo from City Attorney -Tobacco permit ordinance amendment questionsItem: WS.6 STAFF PRESENTATION TO FOLLOW: CITY OF lOVVA CITY 41 ❑ East Washington Street Iowa City, Iowa 52240- 1826 (319) 356-5000 Q 19) 356-5009 FAX www.icgov.org CITY OF IOWA CITY MEMORANDUM Date: August 15, 2024 - City Council From: Eric R. Goers, City Attorney Re: Tobacco permit ordinance amendment Questions At your August 61 Work Session, Council asked me to identify the issues the City Clerk and I had identified as needing Council guidance. Those issues, largely grouped by the draft ordinance amendment to which they most closely relate, are found below. As always, please do not hesitate to contact me if you have questions or concerns. Permit Cap. 1. We presently have 62 issued permits. Would you like to set the cap somewhere below 62 (and allow for grandfathering and attrition), at 62, or above 62? 2. With all tobacco permits expiring on June 301h each year, does Council wish to require renewals by a certain date? a. This is mostly related to identifying the availability of permits below the cap set by Council. b. If so, what should that date be? More on this below. 3. How do you want to treat retailers who fail to file their renewal applications in a timely manner? a. Grant them some sort of grace period? b. Allow them to have preference for any available permits? c. Treat them like any other new applicant? d. Staff recommendation: i. All renewal applications due by May 31st each year. ii. Staff recommendation: 1. Adopt rules that call for a 60-day grace period for June and July, after which they are treated like any other applicant for a permit. 2. As is the case now, if they don't get renewed in June then they cannot sell tobacco products in July, as their permit would have lapsed. 3. However, we would not consider the permit available to other applicants until August 1 st 4. If, despite a lapsed permit, they don't reapply for and receive a permit by August 151, then the permit is treated as vacant and made available for other applicants, assuming we are below the cap. If we are above the cap then our permit count simply goes down by one. 4. How do we allocate any available permits under the cap should they become available? a. Wait list? b. First come J first served? c. Based on likely percentage of tobacco sales? Do you want to treat vape shops differently? d. Lottery? e. Based on other criteria? 5. Does Council wish to allow one permittee to sell their business to another owner to engage in the continuation of the same, non -expanded business, in the same location, even though a new permit would need to be issued to the new owner in a location that remains nonconforming? a. For example, a Deli -Mart selling a convenience store to Casey's. b. Would that new permit be favored over issuing an available permit via the means Council determines for allocating available permits? c. Staff recommendation: Allow the sale as a legal nonconforming use, favoring the permit issuance over other applicants for available permits, even if we are currently over the cap. 6. Do we wish to impose a requirement for renewing businesses to be actively engaged in the business of selling tobacco products or face denial at the next renewal? a. Do we want to insist that new businesses have space secured and begin selling within a set period of time, e.g. 60 days, to avoid squatting? b. By squatting, I mean property owners securing an available tobacco permit for their property even if they don't have a tenant ready to engage in the sale of tobacco products. In this way, they could secure the right to sell tobacco from their property some day in the future, if a tenant ever wished to do so. 7. Is Council OK with granting the City Clerk administrative authority to write a tobacco permit application addendum to secure the permittee information needed to administer the various ordinance amendments Council is now considering? 8. Does Council wish to time these amendments and resolutions in such a way as to take effect all at once, with the moratorium lifted at the same time? a. Staff recommendation: Yes. Zoning Law (separation distance) 9. Does Council wish to have separation distance between applicants and both other retailers and school property? 10. Does the remainder of the ordinance, including the 60-day grandfather rights retention period, meet with Council approval? Kratom: 11. Does Council wish to ban outright or regulate in some fashion? a. Possible regulatory subjects: i. Age restrictions ii. Marketing to children iii. Adulteration and contamination iv. Strength v. Labeling vi. Testing and sampling vii. Registration and permitting b. Staff recommendation: The City does not have the expertise or capacity to engage in testing for strength, contamination, or anything else. Policing marketing to children would be extremely labor-intensive. Registration and permitting would not likely be useful absent an entire regulatory scheme needing to be enforced. Imposing age restrictions may be more readily enforceable but would still require police resources to perform compliance checks, as with alcohol and tobacco. As a result, staff recommends that Council either ban it outright or leave the status quo in place. Copy to: Geoff Fruin, City Manager Kellie Grace, City Clerk Kirk Lehman, Assistant City Manager Sue Dulek, First Assistant City Attorney Tracy Hightshoe, NDS Director Danielle Sitzman, Development Services Coordinator Anne Russett, Senior Planner Dustin Liston, Police Chief STAFF PRESENTATION CONCLUDED CITY OF IOWA CITY 410 East Washington Street Iowa City, Iowa 52240- 1 826 (319) 356-5000 (319) 356-5009 FAX www.icgov.org