San Diego Board Approves Cannabis Retail Expansion in Unincorporated Areas

Board Vote Lifts Geographic Restrictions on Dispensary Permits

The Board of Supervisors voted 4-1 to amend the county's cannabis ordinance, removing a cap that had restricted retail permits to designated commercial zones in unincorporated communities. Cannabis retailers can now apply for permits in any commercial zoning district that meets state setback requirements from schools and parks. The change affects roughly 1.1 million residents living outside incorporated city boundaries across San Diego County's unincorporated territory.

The county's 2020 cannabis ordinance had permitted only delivery services and limited retail storefronts to a short list of commercial corridors. Industry advocates argued the geographic restrictions created permit bottlenecks and left rural communities underserved.

Timeline of San Diego County's Cannabis Retail Policy

San Diego County adopted its first commercial cannabis ordinance in March 2020, four years after California voters passed Proposition 64. The ordinance authorized delivery-only permits county-wide but restricted storefront retail to three commercial zones: Spring Valley, Lakeside, and Alpine. By January 2024, the county had issued just 12 retail permits under those geographic limits.

Supervisors initiated a review of the ordinance in May 2026 after receiving public comments from operators who reported multi-year permit backlogs. County staff presented a draft amendment in July proposing to remove the geographic caps while maintaining state-mandated 600-foot buffers from schools and 1,000-foot buffers from youth centers.

Fiscal Impact and Permit Fee Structure

The county projects the expansion could generate an additional $2.8 million in annual tax revenue by fiscal year 2029, according to budget documents submitted with the ordinance amendment. San Diego County levies a 5% gross-receipts tax on cannabis sales in unincorporated areas, in addition to the state's 15% excise tax. Retail permit application fees are set at $5,000 per location, with annual renewal fees of $3,200.

County staff estimated the amendment could support 30 to 40 new retail permits over the next three years, based on demand projections from the county's cannabis program office. Right now the county has 18 active retail permits and 22 pending applications.

Opposition Focused on Youth Access and Zoning Concerns

Supervisor Jim Desmond cast the lone dissenting vote, citing concerns about proximity to residential neighborhoods and the adequacy of state setback buffers. During the September 2 hearing, Desmond argued that commercial zoning districts in unincorporated areas often sit adjacent to single-family housing. That creates enforcement challenges for odor complaints and loitering.

The San Diego County Sheriff's Department submitted written comments supporting the amendment but requested additional funding for cannabis enforcement staff. Its current cannabis compliance unit has two full-time deputies covering all unincorporated areas.

State Setback Requirements Remain Unchanged

The amendment doesn't alter California's mandatory 600-foot radius from K-12 schools or the county's 1,000-foot buffer from youth centers and day care facilities. Applicants must submit site plans demonstrating compliance with both state and local setback rules. The county planning department will continue to require conditional use permits for all retail cannabis locations, triggering public hearings and neighbor notification.

County planning staff clarified that the amendment removes only the geographic zone restrictions, not the underlying land-use review process. Operators must still obtain state licensing from the Department of Cannabis Control in addition to county permits.

Industry Response and Application Timing

The San Diego Cannabis Coalition, a trade group representing 40 licensed operators, praised the vote as a step toward parity with incorporated cities. Cities within San Diego County have issued 87 retail permits since 2018, while the unincorporated county had issued only 18 as of August 2026, according to the coalition. The group had lobbied the Board of Supervisors for 18 months to remove the geographic caps.

The ordinance amendment takes effect 30 days after the Board's final vote, meaning new applications under the expanded zoning rules can be filed starting October 2, 2026. County staff will host an applicant workshop on October 15 to review the revised permit process.

What Comes Next for San Diego County Cannabis Policy

The Board of Supervisors directed county staff to return in six months with a report on permit issuance rates and enforcement metrics under the amended ordinance. That review, scheduled for March 2027, will examine whether the expansion led to increased code violations or youth-access complaints. Supervisors also requested a fiscal analysis of whether additional planning and sheriff staff are needed to manage the larger retail footprint.

For comprehensive background on San Diego County's cannabis regulatory framework, see the CannIntel topic hub on the San Diego cannabis program. The county's next scheduled cannabis ordinance review is set for January 2028, when the Board will consider whether to authorize on-site consumption lounges in unincorporated areas.