City council to consider cannabis non-storefront retail regulations

After years of piecemeal cannabis policy, Paso Robles may soon have a permanent, comprehensive framework governing adult-use cannabis delivery businesses — one that would throw open the door to new operators and replace an aging resolution that has kept a tight lid on the industry. The Paso Robles City Council is scheduled to hold a public hearing on Tuesday, Aug. 18 to consider a proposed ordinance that could significantly reshape how cannabis delivery businesses operate within city limits.

What the Proposed Ordinance Would Do

The ordinance under consideration would add Chapter 5.55 to the Paso Robles Municipal Code, establishing a formal permit process, permit requirements, and minimum operating standards for cannabis businesses, according to the Paso Robles Daily News. Businesses would be required to renew a cannabis regulatory permit annually.

Crucially, the proposal would also amend the city's zoning regulations and the Uptown/Town Centre Specific Plan to allow cannabis non-storefront retail businesses in the Riverside Corridor and Commercial/Light Industrial zoning districts — and it would place no cap on the number of non-storefront retailers permitted in those districts. That's a marked departure from the existing policy. The council will also consider revoking Resolution 22-144, which currently authorizes only three specifically named cannabis businesses to operate inside city limits.

New Times SLO reported in May 2026 that city staff had recommended repealing both the three-operator limit and the named-operator system, arguing the current structure has created "unnecessary barriers" and "artificial competition for a small number of permits despite limited demand." Staff also noted there is "little evidence to expect a significant number of new delivery businesses entering the market in Paso Robles."

A cannabis regulatory permit fee will also be discussed at the Aug. 18 meeting, though the city would only formally adopt the fee after a separate future public hearing.

It's important to note what the proposal does not include: storefront dispensaries — the kind of walk-in retail shop found in cities like San Luis Obispo — remain off the table entirely. Officials have explicitly stated that discussion is separate and may be taken up at a future date.

A Long Road to This Moment

Paso Robles has long lagged behind other California cities in embracing the state's legal cannabis market. Non-storefront retail of medicinal cannabis has been allowed in Paso Robles since 2016, but adult-use (recreational) non-storefront retail has largely been prohibited throughout that period — even as state law prohibits cities from banning cannabis deliveries originating from licensed operators outside city limits.

That created a glaring inconsistency: as the city's own planning documents noted, "currently, a resident of Paso Robles has the right to have adult-use cannabis delivered to their home, but the delivery must originate from outside city limits." Local businesses, in effect, were at a competitive disadvantage compared to out-of-town operators who could legally serve Paso Robles doorsteps.

A temporary ordinance authorizing recreational delivery expired quietly in November 2023 without renewal, leaving three local operators — Aquamarine, Dubs Green Garden, and Kinfolk — in a regulatory gray zone. The San Luis Obispo Tribune reported that those businesses held active state licenses for adult-use delivery even as the city had no local authorization in place.

The current push toward a permanent framework accelerated in August 2025, when the City Council voted 4-1 to direct staff to bring forward a zoning code amendment to allow non-storefront retail of adult-use cannabis — in part to level the playing field for locally based delivery businesses. That directive sent the proposal to the Planning Commission, which unanimously recommended the zoning change in February 2026. The council then held a study session in May 2026 to weigh staff recommendations, including the question of whether to scrap the named-operator system established under Resolution 22-144.

What Local Residents Should Know

City data shared during the Planning Commission process showed Paso Robles collects roughly $46,000 annually in cannabis tax revenue from delivery businesses — a figure proponents argue is well below the city's potential, particularly given that Paso voters approved a 10 percent tax on gross receipts of cannabis retail sales back in November 2020.

Under the proposed framework, delivery offices operating in the Riverside Corridor and Commercial/Light Industrial districts would be delivery-only operations — customers would not be permitted on site. The proposal also carries built-in safety buffers: earlier commission-level discussions called for delivery offices to maintain 600-foot setbacks from schools, day care centers, youth centers, and public parks, and on-site signage would be tightly restricted.

How to Weigh In

The public hearing begins at 6 p.m. on Tuesday, Aug. 18, in the Norris Room at Centennial Park, 600 Nickerson Drive — the same temporary meeting location the council has been using while City Hall chambers are unavailable. The meeting will also be livestreamed on the city's YouTube channel.

Residents who want to provide live public comment by phone can call (805) 865-7276; the line opens shortly before the meeting. Written comments may be emailed to [email protected] or mailed to the City Clerk, 1000 Spring St., Paso Robles, CA 93446. Comments received before noon on Aug. 18 will appear in an agenda addendum. Note that any future legal challenge would be limited to issues raised during the public hearing or submitted in writing before or during the meeting.

The project staff report is available at prcity.com/meetings. Questions can be directed to the Community Development Department at [email protected] or (805) 237-3970.