California Senate Bill 69 Adds CEQA Requirements for New Cultivators

As of January 1, 2024, the Department of Cannabis Control (DCC) in California for new cultivation applicants requiring a California Environmental Quality Act (CEQA) exemption must adhere to a new policy. The policy for new cultivation applicants in California applying for licenses from the CA DCC can be found in Senate Bill 69. When submitting applications for cultivation to the DCC, cultivators are required to provide the state with a Notice of Exemption (NOE) based on a CEQA application completed through the California Fish and Wildlife (CDFW) website. CEQA exemptions are categorically based and can be exempt from further environmental review if the project does not adversely affect the environment.

Upon review of SB 69, CA cultivators applying to renew their CA licenses may have to adhere to this new policy if an upgrade to increase the cultivation canopy size is being submitted with the renewal. This would require a revised or amended CDFW CEQA application. Please consult your attorney for advice related to compliance with license renewals.

California Senate Bill 69

CA SB 69 was passed on October 10, 2023, and effective January 1, 2024. All CA DCC new cultivation applicants are affected by the amendments provided in this bill. The text for this bill can be found here.

A summary of SB 69 details how local agencies must now file and record notices of CEQA determinations and exemptions. Local agencies, such as the municipality approving cultivation operations in a city or county, are mentioned as the lead agency in this bill as the responsible party for preparing and certifying the completion of the cultivator environmental report for a project as determined by CDFW application. SB 69 now requires local agencies determining whether to allow or approve a new cultivation project to file the notice of CDFW determination with the county clerk or clerks if the project is demographically located in more than one county. If the project is exempt from CEQA as determined by the local agency, the notice of exemption (NOE) must be available for public inspection and the local agency is required to post the notice in the clerk’s office or on the county clerk’s website. In addition to recording the NOE or determination with the county clerk (or multiple clerks offices), SB 69 requires the local agency to file the notice with the State Clearinghouse at the Office of Planning and Research. The recordation and filing of these CEQA notices by the local agencies with county clerks and the State Clearinghouse for public inspection is the creation of a state-mandated local program.

The Effect on the Department of Cannabis Control in California for New Cultivation Applicants

CA DCC cultivation for new applicants will be affected by SB 69 in the following ways as it relates to applying through the DCC portal:

Applicants must submit:

  1. A copy of the full CEQA application completed through the CDFW website.
  2. The local determination or exemption must contain the staff report or record of decision detailing the project analysis, environmental impact findings, and the conditions of approval from the Planning and Design Review department of the approving local agency. The report will contain other information as those named here are just examples of some of the items found in the report.
  3. A copy of the NOE or determination stamped verifying it has been recorded with the county clerk’s office and the State Clearinghouse at the Office of Planning and Research.

Before SB 69, new cultivator applicants only had to submit a copy of the CEQA application and the NOE. Updates can be found here.

What is CEQA and Why Do Cultivators Need the Notice of Exemption?

The California Environmental Quality Act (CEQA) is an act designed to prevent major, avoidable environmental impacts. “CEQA guidelines explain how to determine whether an activity is subject to review, what steps are involved in the environmental review process, and the required content of environmental documents. CEQA guidelines apply to public agencies throughout the state, including local governments, special districts, and State agencies.”

Local agencies permitting cultivation operators require a CEQA review. Applications through CDFW for cultivator projects inform local government agencies regarding potential impacts to the environment and answers as to how the cultivation project may affect lakes, rivers, streambeds, and wildlife. The city/county will then prepare a report (staff report) based on the cultivator’s CDFW application and determine the effects the project may have environmentally, if any. If there are no environmental impacts, the city/county will then issue a notice of exemption (NOE) for the project. Cultivators will need the NOE when applying for a state cultivation license. 

If you have any questions regarding the SB 69 amendments, contact Sapphire Risk. In addition to security consulting, we can provide general consulting services or have a strong network of compliance professionals. Cultivators have other departments to deal with as well, beyond simply the DCC.

Tracie Rutledge,  a regulatory compliance consultant, has been serving cannabis operators since 2012. Her extensive knowledge in cannabis regulations has assisted many cannabis companies in obtaining local and state cannabis licenses across the country. Tracie is well-versed in compliance as it relates to operating procedures and processes. She passionately works with start-up mom and pop type operators to ensure the cannabis landscape is balanced and not monopolized by large corporations.