Cannabis delivery businesses hoping to set up shop in Novato will now have fewer location options under new restrictions passed by the city this week.

The Novato City Council voted unanimously on Tuesday to require delivery businesses to be at least 600 feet away from residentially zoned areas. At the same time, the council loosened location restrictions for cannabis testing laboratories.

The new restrictions for delivery businesses are a response to concerns raised by San Marin residents earlier this year about a delivery service that sought to set up in their neighborhood.

Novato residents Justin Pool and Jennifer Durham received a conditional license from the city at the start of the year to set up their Highway 420 delivery business at 205 San Marin Drive. They withdrew the idea after receiving strong pushback from nearby residents who said the location was too close to kids at San Marin High School and the Rolling Hills Clubs. Residents also raised concerns about the business attracting crime.

Police Chief Matthew McCaffrey also refuted concerns about the business attracting crime, stating that crime at these types of businesses is often proportionate to the amount of crime that already exists in an area. San Marin’s crime rates were low, he said.

Pool said Wednesday that he and Durham have yet to find a new location but have potential options in the Bel Marin Keys industrial area. Pool said the industrial area is likely one of the only locations his business and future delivery businesses can locate because of the large residential footprint of Novato.

“They’re boxing you into Bel Marin Keys,” Pool said. “It is what it is.”

The new restrictions are another example of Marin’s cautious approach to cannabis businesses, despite nearly 70% of county voters — including a majority of Novato voters — supporting the recreational cannabis legalization measure Proposition 64 in 2016. The measure still allows for local control of cannabis businesses and operations.

Pool said restricting cannabis businesses only will limit tax dollars that could flow into the community. He said the revenue could address issues such as housing Novato’s homeless population in Lee Gerner Park.

“It’s way past the time and the time is now for all of the counties and cities to start opening it up,” Pool said. “The people have voted it to be legalized.”

The City Council also changed its cannabis business rules to give itself more discretion on where testing laboratories can locate. The change reduces the 600-foot setback for testing labs from youth-oriented facilities such as schools, youth centers and playgrounds. Now the range is up to 300 feet.

This change was made to allow an existing medical cannabis testing laboratory, CB Labs, to obtain a license under the city’s rules. The lab at 1615 Hill Road has operated since 2015 under the city’s medical cannabis regulations.

However, the lab is located within 600 feet of the Hill Education Center at the Hill Recreation Area, which violated the city’s previous setback rules adopted in 2019. The lab’s permit with the city is set to expire in December unless it can secure a license before then.

The lower setback for labs was proposed by staff because labs are closed to the public and do not have large amounts of product on site.

“The quantity of cannabis onsite is pretty small for testing laboratories,” Novato Community Development Director Vicki Parker told the council.