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San Luis Obispo Grants City’s First Commercial Cannabis Operator Permits

Post Date:09/06/2019 12:00 PM

Coastal Delivery SLO and Megan’s Organic Market SLO will be the City of San Luis Obispo’s first cannabis businesses, following a several month vetting process that verified they meet the standards established through a collaborative process with the city and community. 

“This is new territory for California cities, and that’s why we have been very thoughtful and deliberate as we go through the application review and permitting process,” said Greg Hermann, Deputy City Manager.  “In the end, the businesses that get permits to operate here will be set up for long term success while also supporting the community character and quality of life that makes San Luis Obispo such a special place.”

The city plans to grant three additional permits and will announce the selected businesses as they are approved. 

The San Luis Obispo City Council approved an ordinance May 22, 2018 allowing commercial cannabis businesses to operate in the city. A maximum of three retail storefront businesses will be allowed. The city will not limit the number of delivery, cultivation, manufacturing and other small businesses.

In late 2018, the City Council adopted cannabis regulations that established a cannabis business operator permit process. The first permit application period opened in January 2019. The city received 11 applications, which were scored by city staff according to merit-based criteria developed with input from the community. These include community benefit; experience; equity and labor; financial investment; and, a commitment to medical cannabis. 

City Manager Derek Johnson reviewed and approved the scores, and on March 28, 2019 the city issued Contingent Operator Permits for three retail storefronts, one delivery service (non-storefront) and one microbusiness (non-storefront).

The five applicants have since proceeded with preparations needed to begin operations, while city staff conducted the next step of the screening and approval process. This step includes extensive background checks for all partners and principals for each of the businesses.

Coastal Delivery SLO and Megan’s Organic Market SLO are the first two to complete the background process and received their operating permits.

To read more about the process for permitting cannabis businesses in the City of San Luis Obispo, visit the city’s website, which has links to the ordinances, evaluation criteria, steps in the process and other background, at

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